Correlation Between Us Global and Icon Information
Can any of the company-specific risk be diversified away by investing in both Us Global 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 Us Global and Icon Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Us Global Leaders and Icon Information Technology, you can compare the effects of market volatilities on Us Global 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 Us Global with a short position of Icon Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Us Global and Icon Information.
Diversification Opportunities for Us Global and Icon Information
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between USGLX and Icon is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Us Global Leaders 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 Us Global 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 Us Global Leaders 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 Us Global i.e., Us Global and Icon Information go up and down completely randomly.
Pair Corralation between Us Global and Icon Information
Assuming the 90 days horizon Us Global Leaders is expected to generate 0.57 times more return on investment than Icon Information. However, Us Global Leaders is 1.75 times less risky than Icon Information. It trades about 0.15 of its potential returns per unit of risk. Icon Information Technology is currently generating about -0.09 per unit of risk. If you would invest 7,357 in Us Global Leaders on August 31, 2024 and sell it today you would earn a total of 222.00 from holding Us Global Leaders or generate 3.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Us Global Leaders vs. Icon Information Technology
Performance |
| Timeline |
| Us Global Leaders |
| Icon Information Tec |
Us Global and Icon Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Us Global and Icon Information
The main advantage of trading using opposite Us Global and Icon Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Us Global 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.| Us Global vs. Europacific Growth Fund | Us Global vs. Washington Mutual Investors | Us Global vs. Capital World Growth | Us Global vs. HUMANA INC |
| Icon Information vs. Mirova Global Green | Icon Information vs. Ab Global Risk | Icon Information vs. T Rowe Price | Icon Information vs. Us Global Leaders |
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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