Correlation Between Needham Aggressive and Icon Information
Can any of the company-specific risk be diversified away by investing in both Needham Aggressive and Icon Information 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 Needham Aggressive and Icon Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Needham Aggressive Growth and Icon Information Technology, you can compare the effects of market volatilities on Needham Aggressive and Icon Information 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 Needham Aggressive with a short position of Icon Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Needham Aggressive and Icon Information.
Diversification Opportunities for Needham Aggressive and Icon Information
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Needham and Icon is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Needham Aggressive Growth and Icon Information Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icon Information Tec and Needham Aggressive 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 Needham Aggressive Growth are associated (or correlated) with Icon Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icon Information Tec has no effect on the direction of Needham Aggressive i.e., Needham Aggressive and Icon Information go up and down completely randomly.
Pair Corralation between Needham Aggressive and Icon Information
Assuming the 90 days horizon Needham Aggressive Growth is expected to generate 1.33 times more return on investment than Icon Information. However, Needham Aggressive is 1.33 times more volatile than Icon Information Technology. It trades about 0.07 of its potential returns per unit of risk. Icon Information Technology is currently generating about 0.02 per unit of risk. If you would invest 3,379 in Needham Aggressive Growth on October 22, 2024 and sell it today you would earn a total of 1,756 from holding Needham Aggressive Growth or generate 51.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Needham Aggressive Growth vs. Icon Information Technology
Performance |
| Timeline |
| Needham Aggressive Growth |
| Icon Information Tec |
Needham Aggressive and Icon Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Needham Aggressive and Icon Information
The main advantage of trading using opposite Needham Aggressive and Icon Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Needham Aggressive position performs unexpectedly, Icon Information 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 Icon Information will offset losses from the drop in Icon Information's long position.| Needham Aggressive vs. Needham Aggressive Growth | Needham Aggressive vs. Needham Small Cap | Needham Aggressive vs. Ultramid Cap Profund Ultramid Cap | Needham Aggressive vs. Fidelity Advisor Semiconductors |
| Icon Information vs. Pgim Jennison Technology | Icon Information vs. Pgim Jennison Technology | Icon Information vs. Towpath Technology | Icon Information vs. Vanguard Information Technology |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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