Correlation Between Guidemark Large and Icon Information

Can any of the company-specific risk be diversified away by investing in both Guidemark Large 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 Guidemark Large and Icon Information into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Guidemark Large Cap and Icon Information Technology, you can compare the effects of market volatilities on Guidemark Large 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 Guidemark Large with a short position of Icon Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guidemark Large and Icon Information.

Diversification Opportunities for Guidemark Large and Icon Information

0.92

Correlation Coefficient

Guidemark Large  Icon Information

Almost no diversification

The 3 months correlation between Guidemark and Icon is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Guidemark Large Cap 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 Guidemark Large 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 Guidemark Large Cap 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 Guidemark Large i.e., Guidemark Large and Icon Information go up and down completely randomly.

Pair Corralation between Guidemark Large and Icon Information

Assuming the 90 days horizon Guidemark Large Cap is expected to generate 0.77 times more return on investment than Icon Information. However, Guidemark Large Cap is 1.3 times less risky than Icon Information. It trades about 0.2 of its potential returns per unit of risk. Icon Information Technology is currently generating about 0.13 per unit of risk. If you would invest  1,207  in Guidemark Large Cap on May 22, 2025 and sell it today you would earn a total of  110.00  from holding Guidemark Large Cap or generate 9.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Guidemark Large Cap  vs.  Icon Information Technology

Guidemark Large Cap

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Guidemark Large Cap are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Guidemark Large may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Icon Information Tec

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Icon Information Technology are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Icon Information may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Guidemark Large and Icon Information

The main advantage of trading using opposite Guidemark Large and Icon Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guidemark Large 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.

The idea behind Guidemark Large Cap and Icon Information Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.