Correlation Between ICON PLC and Olink Holding
Can any of the company-specific risk be diversified away by investing in both ICON PLC and Olink Holding 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 PLC and Olink Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICON PLC and Olink Holding AB, you can compare the effects of market volatilities on ICON PLC and Olink Holding 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 PLC with a short position of Olink Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICON PLC and Olink Holding.
Diversification Opportunities for ICON PLC and Olink Holding
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ICON and Olink is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding ICON PLC and Olink Holding AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Olink Holding AB and ICON PLC 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 PLC are associated (or correlated) with Olink Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Olink Holding AB has no effect on the direction of ICON PLC i.e., ICON PLC and Olink Holding go up and down completely randomly.
Pair Corralation between ICON PLC and Olink Holding
Given the investment horizon of 90 days ICON PLC is expected to generate 4.27 times less return on investment than Olink Holding. But when comparing it to its historical volatility, ICON PLC is 1.99 times less risky than Olink Holding. It trades about 0.02 of its potential returns per unit of risk. Olink Holding AB is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,037 in Olink Holding AB on August 31, 2024 and sell it today you would earn a total of 571.00 from holding Olink Holding AB or generate 28.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 79.08% |
| Values | Daily Returns |
ICON PLC vs. Olink Holding AB
Performance |
| Timeline |
| ICON PLC |
| Olink Holding AB |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ICON PLC and Olink Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICON PLC and Olink Holding
The main advantage of trading using opposite ICON PLC and Olink Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICON PLC position performs unexpectedly, Olink Holding 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 Olink Holding will offset losses from the drop in Olink Holding's long position.| ICON PLC vs. Mettler Toledo International | ICON PLC vs. Charles River Laboratories | ICON PLC vs. Laboratory of | ICON PLC vs. IQVIA Holdings |
| Olink Holding vs. Fonar | Olink Holding vs. Burning Rock Biotech | Olink Holding vs. Sera Prognostics | Olink Holding vs. Psychemedics |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |