Correlation Between Credo Technology and Icon Equity
Can any of the company-specific risk be diversified away by investing in both Credo Technology and Icon Equity 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 Credo Technology and Icon Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Credo Technology Group and Icon Equity Income, you can compare the effects of market volatilities on Credo Technology and Icon Equity 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 Credo Technology with a short position of Icon Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Credo Technology and Icon Equity.
Diversification Opportunities for Credo Technology and Icon Equity
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Credo and Icon is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Credo Technology Group and Icon Equity Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icon Equity Income and Credo Technology 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 Credo Technology Group are associated (or correlated) with Icon Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icon Equity Income has no effect on the direction of Credo Technology i.e., Credo Technology and Icon Equity go up and down completely randomly.
Pair Corralation between Credo Technology and Icon Equity
Given the investment horizon of 90 days Credo Technology Group is expected to generate 6.67 times more return on investment than Icon Equity. However, Credo Technology is 6.67 times more volatile than Icon Equity Income. It trades about 0.1 of its potential returns per unit of risk. Icon Equity Income is currently generating about 0.04 per unit of risk. If you would invest 4,014 in Credo Technology Group on September 21, 2025 and sell it today you would earn a total of 10,999 from holding Credo Technology Group or generate 274.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Credo Technology Group vs. Icon Equity Income
Performance |
| Timeline |
| Credo Technology |
| Icon Equity Income |
Credo Technology and Icon Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Credo Technology and Icon Equity
The main advantage of trading using opposite Credo Technology and Icon Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Credo Technology position performs unexpectedly, Icon Equity 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 Equity will offset losses from the drop in Icon Equity's long position.| Credo Technology vs. Hewlett Packard Enterprise | Credo Technology vs. Ciena Corp | Credo Technology vs. Telefonaktiebolaget LM Ericsson | Credo Technology vs. Astera Labs, Common |
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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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