Correlation Between ICON PLC and Powell Max
Can any of the company-specific risk be diversified away by investing in both ICON PLC and Powell Max 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 Powell Max into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICON PLC and Powell Max Limited, you can compare the effects of market volatilities on ICON PLC and Powell Max 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 Powell Max. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICON PLC and Powell Max.
Diversification Opportunities for ICON PLC and Powell Max
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ICON and Powell is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding ICON PLC and Powell Max Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Powell Max Limited 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 Powell Max. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Powell Max Limited has no effect on the direction of ICON PLC i.e., ICON PLC and Powell Max go up and down completely randomly.
Pair Corralation between ICON PLC and Powell Max
Given the investment horizon of 90 days ICON PLC is expected to generate 0.38 times more return on investment than Powell Max. However, ICON PLC is 2.65 times less risky than Powell Max. It trades about 0.0 of its potential returns per unit of risk. Powell Max Limited is currently generating about -0.04 per unit of risk. If you would invest 22,506 in ICON PLC on August 31, 2024 and sell it today you would lose (1,481) from holding ICON PLC or give up 6.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 16.58% |
| Values | Daily Returns |
ICON PLC vs. Powell Max Limited
Performance |
| Timeline |
| ICON PLC |
| Powell Max Limited |
ICON PLC and Powell Max Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICON PLC and Powell Max
The main advantage of trading using opposite ICON PLC and Powell Max positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICON PLC position performs unexpectedly, Powell Max 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 Powell Max will offset losses from the drop in Powell Max'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 |
| Powell Max vs. Star Equity Holdings | Powell Max vs. Prenetics Global | Powell Max vs. ICON PLC | Powell Max vs. iSpecimen |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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