Correlation Between Mills Music and ICC Holdings
Can any of the company-specific risk be diversified away by investing in both Mills Music and ICC Holdings 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 Mills Music and ICC Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mills Music Trust and ICC Holdings, you can compare the effects of market volatilities on Mills Music and ICC Holdings 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 Mills Music with a short position of ICC Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mills Music and ICC Holdings.
Diversification Opportunities for Mills Music and ICC Holdings
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Mills and ICC is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Mills Music Trust and ICC Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICC Holdings and Mills Music 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 Mills Music Trust are associated (or correlated) with ICC Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ICC Holdings has no effect on the direction of Mills Music i.e., Mills Music and ICC Holdings go up and down completely randomly.
Pair Corralation between Mills Music and ICC Holdings
Assuming the 90 days horizon Mills Music is expected to generate 36.41 times less return on investment than ICC Holdings. But when comparing it to its historical volatility, Mills Music Trust is 21.94 times less risky than ICC Holdings. It trades about 0.04 of its potential returns per unit of risk. ICC Holdings is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,525 in ICC Holdings on August 27, 2024 and sell it today you would earn a total of 799.00 from holding ICC Holdings or generate 52.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 73.58% |
| Values | Daily Returns |
Mills Music Trust vs. ICC Holdings
Performance |
| Timeline |
| Mills Music Trust |
| ICC Holdings |
Mills Music and ICC Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mills Music and ICC Holdings
The main advantage of trading using opposite Mills Music and ICC Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mills Music position performs unexpectedly, ICC Holdings 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 ICC Holdings will offset losses from the drop in ICC Holdings' long position.| Mills Music vs. Cintas | Mills Music vs. Thomson Reuters Corp | Mills Music vs. Global Payments | Mills Music vs. RB Global |
| ICC Holdings vs. Employers Holdings | ICC Holdings vs. AMERISAFE | ICC Holdings vs. NMI Holdings | ICC Holdings vs. Investors Title |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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