Correlation Between Icon Financial and Aberdeen Small
Can any of the company-specific risk be diversified away by investing in both Icon Financial and Aberdeen Small 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 Aberdeen Small 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 Aberdeen Small Cap, you can compare the effects of market volatilities on Icon Financial and Aberdeen Small 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 Aberdeen Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Financial and Aberdeen Small.
Diversification Opportunities for Icon Financial and Aberdeen Small
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Icon and Aberdeen is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Icon Financial Fund and Aberdeen Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Small Cap 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 Aberdeen Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Small Cap has no effect on the direction of Icon Financial i.e., Icon Financial and Aberdeen Small go up and down completely randomly.
Pair Corralation between Icon Financial and Aberdeen Small
Assuming the 90 days horizon Icon Financial Fund is expected to under-perform the Aberdeen Small. In addition to that, Icon Financial is 3.6 times more volatile than Aberdeen Small Cap. It trades about -0.16 of its total potential returns per unit of risk. Aberdeen Small Cap is currently generating about 0.0 per unit of volatility. If you would invest 3,191 in Aberdeen Small Cap on September 12, 2024 and sell it today you would lose (2.00) from holding Aberdeen Small Cap or give up 0.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Icon Financial Fund vs. Aberdeen Small Cap
Performance |
| Timeline |
| Icon Financial |
| Aberdeen Small Cap |
Icon Financial and Aberdeen Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icon Financial and Aberdeen Small
The main advantage of trading using opposite Icon Financial and Aberdeen Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icon Financial position performs unexpectedly, Aberdeen Small 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 Aberdeen Small will offset losses from the drop in Aberdeen Small's long position.| Icon Financial vs. T Rowe Price | Icon Financial vs. Rational Defensive Growth | Icon Financial vs. Franklin Growth Opportunities | Icon Financial vs. Smallcap Growth Fund |
| Aberdeen Small vs. Mesirow Financial Small | Aberdeen Small vs. Icon Financial Fund | Aberdeen Small vs. Gabelli Global Financial | Aberdeen Small vs. Royce Global Financial |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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