Correlation Between Icon Financial and Jpmorgan Hedged
Can any of the company-specific risk be diversified away by investing in both Icon Financial and Jpmorgan Hedged 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 Jpmorgan Hedged 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 Jpmorgan Hedged Equity, you can compare the effects of market volatilities on Icon Financial and Jpmorgan Hedged 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 Jpmorgan Hedged. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Financial and Jpmorgan Hedged.
Diversification Opportunities for Icon Financial and Jpmorgan Hedged
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Icon and Jpmorgan is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Icon Financial Fund and Jpmorgan Hedged Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Hedged Equity 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 Jpmorgan Hedged. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Hedged Equity has no effect on the direction of Icon Financial i.e., Icon Financial and Jpmorgan Hedged go up and down completely randomly.
Pair Corralation between Icon Financial and Jpmorgan Hedged
Assuming the 90 days horizon Icon Financial Fund is expected to generate 2.36 times more return on investment than Jpmorgan Hedged. However, Icon Financial is 2.36 times more volatile than Jpmorgan Hedged Equity. It trades about 0.2 of its potential returns per unit of risk. Jpmorgan Hedged Equity is currently generating about 0.17 per unit of risk. If you would invest 1,091 in Icon Financial Fund on August 27, 2024 and sell it today you would earn a total of 61.00 from holding Icon Financial Fund or generate 5.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Icon Financial Fund vs. Jpmorgan Hedged Equity
Performance |
| Timeline |
| Icon Financial |
| Jpmorgan Hedged Equity |
Icon Financial and Jpmorgan Hedged Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icon Financial and Jpmorgan Hedged
The main advantage of trading using opposite Icon Financial and Jpmorgan Hedged positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icon Financial position performs unexpectedly, Jpmorgan Hedged 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 Jpmorgan Hedged will offset losses from the drop in Jpmorgan Hedged's long position.| Icon Financial vs. Loomis Sayles Inflation | Icon Financial vs. Arrow Managed Futures | Icon Financial vs. Guidepath Managed Futures | Icon Financial vs. Western Asset Inflation |
| Jpmorgan Hedged vs. Vanguard Financials Index | Jpmorgan Hedged vs. Icon Financial Fund | Jpmorgan Hedged vs. Mesirow Financial Small | Jpmorgan Hedged vs. Transamerica Financial Life |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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