Correlation Between Icon Energy and Lion One
Can any of the company-specific risk be diversified away by investing in both Icon Energy and Lion One 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 Energy and Lion One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Icon Energy Corp and Lion One Metals, you can compare the effects of market volatilities on Icon Energy and Lion One 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 Energy with a short position of Lion One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Energy and Lion One.
Diversification Opportunities for Icon Energy and Lion One
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Icon and Lion is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Icon Energy Corp and Lion One Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion One Metals and Icon Energy 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 Energy Corp are associated (or correlated) with Lion One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion One Metals has no effect on the direction of Icon Energy i.e., Icon Energy and Lion One go up and down completely randomly.
Pair Corralation between Icon Energy and Lion One
Given the investment horizon of 90 days Icon Energy Corp is expected to under-perform the Lion One. In addition to that, Icon Energy is 3.57 times more volatile than Lion One Metals. It trades about -0.18 of its total potential returns per unit of risk. Lion One Metals is currently generating about -0.03 per unit of volatility. If you would invest 19.00 in Lion One Metals on January 8, 2025 and sell it today you would lose (1.00) from holding Lion One Metals or give up 5.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Icon Energy Corp vs. Lion One Metals
Performance |
| Timeline |
| Icon Energy Corp |
| Lion One Metals |
Icon Energy and Lion One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icon Energy and Lion One
The main advantage of trading using opposite Icon Energy and Lion One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icon Energy position performs unexpectedly, Lion One 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 Lion One will offset losses from the drop in Lion One's long position.| Icon Energy vs. Hudson Technologies | Icon Energy vs. Alignment Healthcare LLC | Icon Energy vs. Fidelity National Financial | Icon Energy vs. Morgan Advanced Materials |
| Lion One vs. Piedmont Lithium Ltd | Lion One vs. Sigma Lithium Resources | Lion One vs. Standard Lithium | Lion One vs. MP Materials Corp |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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