Correlation Between Icon Long/short and Icon Information
Can any of the company-specific risk be diversified away by investing in both Icon Long/short 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 Icon Long/short and Icon Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Icon Longshort Fund and Icon Information Technology, you can compare the effects of market volatilities on Icon Long/short 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 Icon Long/short with a short position of Icon Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Long/short and Icon Information.
Diversification Opportunities for Icon Long/short and Icon Information
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Icon and Icon is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Icon Longshort Fund 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 Icon Long/short 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 Icon Longshort Fund 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 Icon Long/short i.e., Icon Long/short and Icon Information go up and down completely randomly.
Pair Corralation between Icon Long/short and Icon Information
Assuming the 90 days horizon Icon Long/short is expected to generate 2.68 times less return on investment than Icon Information. But when comparing it to its historical volatility, Icon Longshort Fund is 1.08 times less risky than Icon Information. It trades about 0.09 of its potential returns per unit of risk. Icon Information Technology is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,480 in Icon Information Technology on August 2, 2025 and sell it today you would earn a total of 237.00 from holding Icon Information Technology or generate 16.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.44% |
| Values | Daily Returns |
Icon Longshort Fund vs. Icon Information Technology
Performance |
| Timeline |
| Icon Long/short |
| Icon Information Tec |
Icon Long/short and Icon Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Icon Long/short and Icon Information
The main advantage of trading using opposite Icon Long/short and Icon Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icon Long/short 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.| Icon Long/short vs. Vanguard Total World | Icon Long/short vs. Qs Growth Fund | Icon Long/short vs. T Rowe Price | Icon Long/short vs. Balanced Fund Retail |
| Icon Information vs. Us Government Securities | Icon Information vs. Us Government Securities | Icon Information vs. Us Government Securities | Icon Information vs. Government Securities Fund |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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