Correlation Between Icon Financial and Siit Large
Can any of the company-specific risk be diversified away by investing in both Icon Financial and Siit 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 Siit 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 Siit Large Cap, you can compare the effects of market volatilities on Icon Financial and Siit 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 Siit Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Financial and Siit Large.
Diversification Opportunities for Icon Financial and Siit Large
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Icon and Siit is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Icon Financial Fund and Siit Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit Large 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 Siit Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit Large Cap has no effect on the direction of Icon Financial i.e., Icon Financial and Siit Large go up and down completely randomly.
Pair Corralation between Icon Financial and Siit Large
Assuming the 90 days horizon Icon Financial Fund is expected to generate 1.6 times more return on investment than Siit Large. However, Icon Financial is 1.6 times more volatile than Siit Large Cap. It trades about 0.22 of its potential returns per unit of risk. Siit Large Cap is currently generating about 0.22 per unit of risk. If you would invest 1,085 in Icon Financial Fund on August 31, 2024 and sell it today you would earn a total of 68.00 from holding Icon Financial Fund or generate 6.27% 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. Siit Large Cap
Performance |
| Timeline |
| Icon Financial |
| Siit Large Cap |
Icon Financial and Siit Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icon Financial and Siit Large
The main advantage of trading using opposite Icon Financial and Siit Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icon Financial position performs unexpectedly, Siit 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 Siit Large will offset losses from the drop in Siit Large's long position.| Icon Financial vs. Vanguard Financials Index | Icon Financial vs. Regional Bank Fund | Icon Financial vs. Regional Bank Fund | Icon Financial vs. Financial Industries Fund |
| Siit Large vs. John Hancock Financial | Siit Large vs. Icon Financial Fund | Siit Large vs. Royce Global Financial | Siit Large vs. Vanguard Financials Index |
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 Stocks Directory module to find actively traded stocks across global markets.
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