Correlation Between Sextant Bond and Icon Information
Can any of the company-specific risk be diversified away by investing in both Sextant Bond 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 Sextant Bond and Icon Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sextant Bond Income and Icon Information Technology, you can compare the effects of market volatilities on Sextant Bond 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 Sextant Bond with a short position of Icon Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sextant Bond and Icon Information.
Diversification Opportunities for Sextant Bond and Icon Information
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sextant and ICON is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Sextant Bond Income 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 Sextant 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 Sextant Bond Income 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 Sextant Bond i.e., Sextant Bond and Icon Information go up and down completely randomly.
Pair Corralation between Sextant Bond and Icon Information
Assuming the 90 days horizon Sextant Bond is expected to generate 7.23 times less return on investment than Icon Information. But when comparing it to its historical volatility, Sextant Bond Income is 2.38 times less risky than Icon Information. It trades about 0.07 of its potential returns per unit of risk. Icon Information Technology is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 1,462 in Icon Information Technology on October 25, 2024 and sell it today you would earn a total of 50.00 from holding Icon Information Technology or generate 3.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sextant Bond Income vs. Icon Information Technology
Performance |
| Timeline |
| Sextant Bond Income |
| Icon Information Tec |
Sextant Bond and Icon Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sextant Bond and Icon Information
The main advantage of trading using opposite Sextant Bond and Icon Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sextant Bond 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.| Sextant Bond vs. Icon Information Technology | Sextant Bond vs. Blackrock Science Technology | Sextant Bond vs. Hennessy Technology Fund | Sextant Bond vs. Global Technology Portfolio |
| Icon Information vs. Sierra E Retirement | Icon Information vs. Columbia Moderate Growth | Icon Information vs. Franklin Lifesmart Retirement | Icon Information vs. Transamerica Cleartrack 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |