Correlation Between Icon Financial and Alphacentric Global
Can any of the company-specific risk be diversified away by investing in both Icon Financial and Alphacentric Global 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 Alphacentric Global 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 Alphacentric Global Innovations, you can compare the effects of market volatilities on Icon Financial and Alphacentric Global 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 Alphacentric Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Financial and Alphacentric Global.
Diversification Opportunities for Icon Financial and Alphacentric Global
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Icon and Alphacentric is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Icon Financial Fund and Alphacentric Global Innovation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alphacentric Global 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 Alphacentric Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alphacentric Global has no effect on the direction of Icon Financial i.e., Icon Financial and Alphacentric Global go up and down completely randomly.
Pair Corralation between Icon Financial and Alphacentric Global
Assuming the 90 days horizon Icon Financial Fund is expected to generate 0.73 times more return on investment than Alphacentric Global. However, Icon Financial Fund is 1.38 times less risky than Alphacentric Global. It trades about 0.06 of its potential returns per unit of risk. Alphacentric Global Innovations is currently generating about 0.03 per unit of risk. If you would invest 906.00 in Icon Financial Fund on August 30, 2024 and sell it today you would earn a total of 247.00 from holding Icon Financial Fund or generate 27.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Icon Financial Fund vs. Alphacentric Global Innovation
Performance |
| Timeline |
| Icon Financial |
| Alphacentric Global |
Icon Financial and Alphacentric Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icon Financial and Alphacentric Global
The main advantage of trading using opposite Icon Financial and Alphacentric Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icon Financial position performs unexpectedly, Alphacentric Global 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 Alphacentric Global will offset losses from the drop in Alphacentric Global's long position.| Icon Financial vs. HUMANA INC | Icon Financial vs. Aquagold International | Icon Financial vs. Barloworld Ltd ADR | Icon Financial vs. Morningstar Unconstrained Allocation |
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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