Correlation Between ICF International and Spire Global
Can any of the company-specific risk be diversified away by investing in both ICF International and Spire 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 ICF International and Spire Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICF International and Spire Global, you can compare the effects of market volatilities on ICF International and Spire 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 ICF International with a short position of Spire Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICF International and Spire Global.
Diversification Opportunities for ICF International and Spire Global
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ICF and Spire is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding ICF International and Spire Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spire Global and ICF International 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 ICF International are associated (or correlated) with Spire Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spire Global has no effect on the direction of ICF International i.e., ICF International and Spire Global go up and down completely randomly.
Pair Corralation between ICF International and Spire Global
Given the investment horizon of 90 days ICF International is expected to generate 3.87 times less return on investment than Spire Global. But when comparing it to its historical volatility, ICF International is 3.35 times less risky than Spire Global. It trades about 0.04 of its potential returns per unit of risk. Spire Global is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 960.00 in Spire Global on September 2, 2024 and sell it today you would earn a total of 674.00 from holding Spire Global or generate 70.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ICF International vs. Spire Global
Performance |
| Timeline |
| ICF International |
| Spire Global |
ICF International and Spire Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICF International and Spire Global
The main advantage of trading using opposite ICF International and Spire Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICF International position performs unexpectedly, Spire 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 Spire Global will offset losses from the drop in Spire Global's long position.| ICF International vs. Forrester Research | ICF International vs. Huron Consulting Group | ICF International vs. Franklin Covey | ICF International vs. FTI Consulting |
| Spire Global vs. Lichen China Limited | Spire Global vs. Unifirst | Spire Global vs. First Advantage Corp | Spire Global vs. Performant 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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