Correlation Between VivoPower International and Icon Financial
Can any of the company-specific risk be diversified away by investing in both VivoPower International 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 VivoPower International and Icon Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VivoPower International PLC and Icon Financial Fund, you can compare the effects of market volatilities on VivoPower International 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 VivoPower International with a short position of Icon Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of VivoPower International and Icon Financial.
Diversification Opportunities for VivoPower International and Icon Financial
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between VivoPower and Icon is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding VivoPower International PLC and Icon Financial Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icon Financial and VivoPower International 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 VivoPower International PLC 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 VivoPower International i.e., VivoPower International and Icon Financial go up and down completely randomly.
Pair Corralation between VivoPower International and Icon Financial
Given the investment horizon of 90 days VivoPower International PLC is expected to generate 14.56 times more return on investment than Icon Financial. However, VivoPower International is 14.56 times more volatile than Icon Financial Fund. It trades about 0.14 of its potential returns per unit of risk. Icon Financial Fund is currently generating about 0.2 per unit of risk. If you would invest 84.00 in VivoPower International PLC on August 27, 2024 and sell it today you would earn a total of 23.00 from holding VivoPower International PLC or generate 27.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VivoPower International PLC vs. Icon Financial Fund
Performance |
| Timeline |
| VivoPower International |
| Icon Financial |
VivoPower International and Icon Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VivoPower International and Icon Financial
The main advantage of trading using opposite VivoPower International and Icon Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VivoPower International 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.| VivoPower International vs. Emeren Group | VivoPower International vs. Tigo Energy | VivoPower International vs. Sunrun Inc | VivoPower International vs. Sunnova Energy International |
| Icon Financial vs. Loomis Sayles Inflation | Icon Financial vs. Arrow Managed Futures | Icon Financial vs. Guidepath Managed Futures | Icon Financial vs. Western Asset Inflation |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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