Correlation Between Icon Financial and Strategic Enhanced
Can any of the company-specific risk be diversified away by investing in both Icon Financial and Strategic Enhanced 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 Icon Financial and Strategic Enhanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Icon Financial Fund and Strategic Enhanced Yield, you can compare the effects of market volatilities on Icon Financial and Strategic Enhanced 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 Icon Financial with a short position of Strategic Enhanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Financial and Strategic Enhanced.
Diversification Opportunities for Icon Financial and Strategic Enhanced
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Icon and Strategic is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Icon Financial Fund and Strategic Enhanced Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strategic Enhanced Yield and Icon Financial 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 Icon Financial Fund are associated (or correlated) with Strategic Enhanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strategic Enhanced Yield has no effect on the direction of Icon Financial i.e., Icon Financial and Strategic Enhanced go up and down completely randomly.
Pair Corralation between Icon Financial and Strategic Enhanced
Assuming the 90 days horizon Icon Financial Fund is expected to under-perform the Strategic Enhanced. In addition to that, Icon Financial is 7.99 times more volatile than Strategic Enhanced Yield. It trades about -0.04 of its total potential returns per unit of risk. Strategic Enhanced Yield is currently generating about -0.05 per unit of volatility. If you would invest 895.00 in Strategic Enhanced Yield on September 3, 2024 and sell it today you would lose (7.00) from holding Strategic Enhanced Yield or give up 0.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Icon Financial Fund vs. Strategic Enhanced Yield
Performance |
| Timeline |
| Icon Financial |
| Strategic Enhanced Yield |
Icon Financial and Strategic Enhanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icon Financial and Strategic Enhanced
The main advantage of trading using opposite Icon Financial and Strategic Enhanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icon Financial position performs unexpectedly, Strategic Enhanced 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 Strategic Enhanced will offset losses from the drop in Strategic Enhanced's long position.| Icon Financial vs. Vanguard Financials Index | Icon Financial vs. Regional Bank Fund | Icon Financial vs. T Rowe Price | Icon Financial vs. Financial Industries Fund |
| Strategic Enhanced vs. Mesirow Financial Small | Strategic Enhanced vs. Icon Financial Fund | Strategic Enhanced vs. Angel Oak Financial | Strategic Enhanced vs. Blackrock Financial Institutions |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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