Correlation Between ICOA and Greenhill
Can any of the company-specific risk be diversified away by investing in both ICOA and Greenhill 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 ICOA and Greenhill into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICOA Inc and Greenhill Co, you can compare the effects of market volatilities on ICOA and Greenhill 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 ICOA with a short position of Greenhill. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICOA and Greenhill.
Diversification Opportunities for ICOA and Greenhill
Pay attention - limited upside
The 3 months correlation between ICOA and Greenhill is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ICOA Inc and Greenhill Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenhill and ICOA 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 ICOA Inc are associated (or correlated) with Greenhill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenhill has no effect on the direction of ICOA i.e., ICOA and Greenhill go up and down completely randomly.
Pair Corralation between ICOA and Greenhill
Given the investment horizon of 90 days ICOA Inc is expected to generate 2.37 times more return on investment than Greenhill. However, ICOA is 2.37 times more volatile than Greenhill Co. It trades about 0.06 of its potential returns per unit of risk. Greenhill Co is currently generating about 0.06 per unit of risk. If you would invest 0.19 in ICOA Inc on September 4, 2024 and sell it today you would lose (0.19) from holding ICOA Inc or give up 100.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 30.77% |
| Values | Daily Returns |
ICOA Inc vs. Greenhill Co
Performance |
| Timeline |
| ICOA Inc |
| Greenhill |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ICOA and Greenhill Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICOA and Greenhill
The main advantage of trading using opposite ICOA and Greenhill positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICOA position performs unexpectedly, Greenhill 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 Greenhill will offset losses from the drop in Greenhill's long position.The idea behind ICOA Inc and Greenhill Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Greenhill vs. Magic Empire Global | Greenhill vs. Applied Blockchain | Greenhill vs. Zhong Yang Financial | Greenhill vs. Netcapital |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |