Correlation Between ICON Project and Stellar
Can any of the company-specific risk be diversified away by investing in both ICON Project and Stellar 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 Project and Stellar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICON Project and Stellar, you can compare the effects of market volatilities on ICON Project and Stellar 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 Project with a short position of Stellar. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICON Project and Stellar.
Diversification Opportunities for ICON Project and Stellar
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ICON and Stellar is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding ICON Project and Stellar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stellar and ICON Project 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 Project are associated (or correlated) with Stellar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stellar has no effect on the direction of ICON Project i.e., ICON Project and Stellar go up and down completely randomly.
Pair Corralation between ICON Project and Stellar
Assuming the 90 days trading horizon ICON Project is expected to generate 1.22 times more return on investment than Stellar. However, ICON Project is 1.22 times more volatile than Stellar. It trades about 0.06 of its potential returns per unit of risk. Stellar is currently generating about 0.05 per unit of risk. If you would invest 22.00 in ICON Project on January 24, 2024 and sell it today you would earn a total of 3.00 from holding ICON Project or generate 13.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
ICON Project vs. Stellar
Performance |
Timeline |
ICON Project |
Stellar |
ICON Project and Stellar Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ICON Project and Stellar
The main advantage of trading using opposite ICON Project and Stellar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICON Project position performs unexpectedly, Stellar 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 Stellar will offset losses from the drop in Stellar's long position.ICON Project vs. Ethereum | ICON Project vs. Cardano | ICON Project vs. Avalanche | ICON Project vs. Internet Computer |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
Content Syndication Quickly integrate customizable finance content to your own investment portal | |
Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |