Correlation Between ICC Holdings and Mills Music
Can any of the company-specific risk be diversified away by investing in both ICC Holdings and Mills Music at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining ICC Holdings and Mills Music into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICC Holdings and Mills Music Trust, you can compare the effects of market volatilities on ICC Holdings and Mills Music and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in ICC Holdings with a short position of Mills Music. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICC Holdings and Mills Music.
Diversification Opportunities for ICC Holdings and Mills Music
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ICC and Mills is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding ICC Holdings and Mills Music Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mills Music Trust and ICC Holdings is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on ICC Holdings are associated (or correlated) with Mills Music. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mills Music Trust has no effect on the direction of ICC Holdings i.e., ICC Holdings and Mills Music go up and down completely randomly.
Pair Corralation between ICC Holdings and Mills Music
Given the investment horizon of 90 days ICC Holdings is expected to generate 21.94 times more return on investment than Mills Music. However, ICC Holdings is 21.94 times more volatile than Mills Music Trust. It trades about 0.07 of its potential returns per unit of risk. Mills Music Trust is currently generating about 0.04 per unit of risk. If you would invest 1,525 in ICC Holdings on August 27, 2024 and sell it today you would earn a total of 799.00 from holding ICC Holdings or generate 52.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 73.58% |
| Values | Daily Returns |
ICC Holdings vs. Mills Music Trust
Performance |
| Timeline |
| ICC Holdings |
| Mills Music Trust |
ICC Holdings and Mills Music Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICC Holdings and Mills Music
The main advantage of trading using opposite ICC Holdings and Mills Music positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICC Holdings position performs unexpectedly, Mills Music can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Mills Music will offset losses from the drop in Mills Music's long position.| ICC Holdings vs. Employers Holdings | ICC Holdings vs. AMERISAFE | ICC Holdings vs. NMI Holdings | ICC Holdings vs. Investors Title |
| Mills Music vs. Cintas | Mills Music vs. Thomson Reuters Corp | Mills Music vs. Global Payments | Mills Music vs. RB Global |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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