Correlation Between Icon Financial and Pace Large
Can any of the company-specific risk be diversified away by investing in both Icon Financial and Pace Large 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 Pace Large 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 Pace Large Value, you can compare the effects of market volatilities on Icon Financial and Pace Large 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 Pace Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Financial and Pace Large.
Diversification Opportunities for Icon Financial and Pace Large
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Icon and Pace is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Icon Financial Fund and Pace Large Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pace Large Value 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 Pace Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pace Large Value has no effect on the direction of Icon Financial i.e., Icon Financial and Pace Large go up and down completely randomly.
Pair Corralation between Icon Financial and Pace Large
Assuming the 90 days horizon Icon Financial is expected to generate 7.46 times less return on investment than Pace Large. In addition to that, Icon Financial is 1.58 times more volatile than Pace Large Value. It trades about 0.01 of its total potential returns per unit of risk. Pace Large Value is currently generating about 0.07 per unit of volatility. If you would invest 1,609 in Pace Large Value on October 11, 2024 and sell it today you would earn a total of 426.00 from holding Pace Large Value or generate 26.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Icon Financial Fund vs. Pace Large Value
Performance |
| Timeline |
| Icon Financial |
| Pace Large Value |
Icon Financial and Pace Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icon Financial and Pace Large
The main advantage of trading using opposite Icon Financial and Pace Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icon Financial position performs unexpectedly, Pace Large 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 Pace Large will offset losses from the drop in Pace Large's long position.| Icon Financial vs. Locorr Dynamic Equity | Icon Financial vs. Us Vector Equity | Icon Financial vs. Greenspring Fund Retail | Icon Financial vs. Quantitative Longshort Equity |
| Pace Large vs. Icon Financial Fund | Pace Large vs. Angel Oak Financial | Pace Large vs. Davis Financial Fund | Pace Large vs. Putnam Global Financials |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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