Correlation Between ICC Holdings and SunOpta
Can any of the company-specific risk be diversified away by investing in both ICC Holdings and SunOpta 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 SunOpta into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICC Holdings and SunOpta, you can compare the effects of market volatilities on ICC Holdings and SunOpta 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 SunOpta. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICC Holdings and SunOpta.
Diversification Opportunities for ICC Holdings and SunOpta
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between ICC and SunOpta is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding ICC Holdings and SunOpta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunOpta 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 SunOpta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunOpta has no effect on the direction of ICC Holdings i.e., ICC Holdings and SunOpta go up and down completely randomly.
Pair Corralation between ICC Holdings and SunOpta
Given the investment horizon of 90 days ICC Holdings is expected to generate 12.8 times less return on investment than SunOpta. But when comparing it to its historical volatility, ICC Holdings is 5.55 times less risky than SunOpta. It trades about 0.07 of its potential returns per unit of risk. SunOpta is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 638.00 in SunOpta on August 29, 2024 and sell it today you would earn a total of 141.00 from holding SunOpta or generate 22.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 83.72% |
| Values | Daily Returns |
ICC Holdings vs. SunOpta
Performance |
| Timeline |
| ICC Holdings |
| SunOpta |
ICC Holdings and SunOpta Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICC Holdings and SunOpta
The main advantage of trading using opposite ICC Holdings and SunOpta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICC Holdings position performs unexpectedly, SunOpta 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 SunOpta will offset losses from the drop in SunOpta's long position.| ICC Holdings vs. AMERISAFE | ICC Holdings vs. Enact Holdings | ICC Holdings vs. Essent Group | ICC Holdings vs. Radian Group |
| SunOpta vs. Seneca Foods Corp | SunOpta vs. Central Garden Pet | SunOpta vs. Natures Sunshine Products | SunOpta vs. Associated British Foods |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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