Correlation Between Icon Bond and Scharf Global
Can any of the company-specific risk be diversified away by investing in both Icon Bond and Scharf 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 Icon Bond and Scharf Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Icon Bond Fund and Scharf Global Opportunity, you can compare the effects of market volatilities on Icon Bond and Scharf 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 Icon Bond with a short position of Scharf Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Bond and Scharf Global.
Diversification Opportunities for Icon Bond and Scharf Global
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Icon and Scharf is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Icon Bond Fund and Scharf Global Opportunity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scharf Global Opportunity and Icon Bond 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 Bond Fund are associated (or correlated) with Scharf Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scharf Global Opportunity has no effect on the direction of Icon Bond i.e., Icon Bond and Scharf Global go up and down completely randomly.
Pair Corralation between Icon Bond and Scharf Global
Assuming the 90 days horizon Icon Bond is expected to generate 1.04 times less return on investment than Scharf Global. But when comparing it to its historical volatility, Icon Bond Fund is 3.85 times less risky than Scharf Global. It trades about 0.18 of its potential returns per unit of risk. Scharf Global Opportunity is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 3,036 in Scharf Global Opportunity on September 26, 2024 and sell it today you would earn a total of 497.00 from holding Scharf Global Opportunity or generate 16.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Icon Bond Fund vs. Scharf Global Opportunity
Performance |
| Timeline |
| Icon Bond Fund |
| Scharf Global Opportunity |
Icon Bond and Scharf Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icon Bond and Scharf Global
The main advantage of trading using opposite Icon Bond and Scharf Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icon Bond position performs unexpectedly, Scharf 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 Scharf Global will offset losses from the drop in Scharf Global's long position.| Icon Bond vs. Icon Equity Income | Icon Bond vs. Icon Longshort Fund | Icon Bond vs. Icon Longshort Fund | Icon Bond vs. Icon Natural Resources |
| Scharf Global vs. Scharf Balanced Opportunity | Scharf Global vs. Scharf Fund Retail | Scharf Global vs. Scharf Balanced Opportunity | Scharf Global vs. Voya Target Retirement |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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