Correlation Between Siit High and Icon Information
Can any of the company-specific risk be diversified away by investing in both Siit High 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 Siit High and Icon Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siit High Yield and Icon Information Technology, you can compare the effects of market volatilities on Siit High 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 Siit High with a short position of Icon Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siit High and Icon Information.
Diversification Opportunities for Siit High and Icon Information
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Siit and Icon is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Siit High Yield 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 Siit High 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 Siit High Yield 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 Siit High i.e., Siit High and Icon Information go up and down completely randomly.
Pair Corralation between Siit High and Icon Information
Assuming the 90 days horizon Siit High is expected to generate 26.76 times less return on investment than Icon Information. But when comparing it to its historical volatility, Siit High Yield is 5.16 times less risky than Icon Information. It trades about 0.04 of its potential returns per unit of risk. Icon Information Technology is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,462 in Icon Information Technology on November 7, 2024 and sell it today you would earn a total of 56.00 from holding Icon Information Technology or generate 3.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siit High Yield vs. Icon Information Technology
Performance |
| Timeline |
| Siit High Yield |
| Icon Information Tec |
Siit High and Icon Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siit High and Icon Information
The main advantage of trading using opposite Siit High and Icon Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siit High 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.| Siit High vs. Ep Emerging Markets | Siit High vs. Siit Emerging Markets | Siit High vs. Federated Emerging Market | Siit High vs. Pnc Emerging Markets |
| Icon Information vs. Baron Real Estate | Icon Information vs. Real Estate Ultrasector | Icon Information vs. Redwood Real Estate | Icon Information vs. Deutsche Real Estate |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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