Correlation Between Old Westbury and Icon Financial
Can any of the company-specific risk be diversified away by investing in both Old Westbury and Icon Financial 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 Old Westbury and Icon Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Old Westbury Municipal and Icon Financial Fund, you can compare the effects of market volatilities on Old Westbury and Icon Financial 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 Old Westbury with a short position of Icon Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Old Westbury and Icon Financial.
Diversification Opportunities for Old Westbury and Icon Financial
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Old and Icon is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Old Westbury Municipal and Icon Financial Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icon Financial and Old Westbury 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 Old Westbury Municipal are associated (or correlated) with Icon Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icon Financial has no effect on the direction of Old Westbury i.e., Old Westbury and Icon Financial go up and down completely randomly.
Pair Corralation between Old Westbury and Icon Financial
Assuming the 90 days horizon Old Westbury Municipal is expected to under-perform the Icon Financial. But the mutual fund apears to be less risky and, when comparing its historical volatility, Old Westbury Municipal is 4.79 times less risky than Icon Financial. The mutual fund trades about -0.06 of its potential returns per unit of risk. The Icon Financial Fund is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 986.00 in Icon Financial Fund on October 30, 2024 and sell it today you would earn a total of 3.00 from holding Icon Financial Fund or generate 0.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Old Westbury Municipal vs. Icon Financial Fund
Performance |
| Timeline |
| Old Westbury Municipal |
| Icon Financial |
Old Westbury and Icon Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Old Westbury and Icon Financial
The main advantage of trading using opposite Old Westbury and Icon Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Old Westbury position performs unexpectedly, Icon Financial 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 Financial will offset losses from the drop in Icon Financial's long position.| Old Westbury vs. Bbh Intermediate Municipal | Old Westbury vs. Rbc Ultra Short Fixed | Old Westbury vs. T Rowe Price | Old Westbury vs. T Rowe Price |
| Icon Financial vs. Nuveen Missouri Municipal | Icon Financial vs. Ab Bond Inflation | Icon Financial vs. Ab Bond Inflation | Icon Financial vs. Artisan High Income |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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