Correlation Between Intercontinental and FactSet Research

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

By analyzing existing cross correlation between Intercontinental Exchange and FactSet Research Systems, you can compare the effects of market volatilities on Intercontinental and FactSet Research 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 Intercontinental with a short position of FactSet Research. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intercontinental and FactSet Research.

Diversification Opportunities for Intercontinental and FactSet Research

0.81

Correlation Coefficient

Intercontinental  FactSet Research

Very poor diversification

The 3 months correlation between Intercontinental and FactSet is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Intercontinental Exchange and FactSet Research Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FactSet Research Systems and Intercontinental 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 Intercontinental Exchange are associated (or correlated) with FactSet Research. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FactSet Research Systems has no effect on the direction of Intercontinental i.e., Intercontinental and FactSet Research go up and down completely randomly.

Pair Corralation between Intercontinental and FactSet Research

Considering the 90-day investment horizon Intercontinental Exchange is expected to generate 0.47 times more return on investment than FactSet Research. However, Intercontinental Exchange is 2.12 times less risky than FactSet Research. It trades about -0.19 of its potential returns per unit of risk. FactSet Research Systems is currently generating about -0.35 per unit of risk. If you would invest  18,258  in Intercontinental Exchange on July 7, 2025 and sell it today you would lose (1,996) from holding Intercontinental Exchange or give up 10.93% of portfolio value over 90 days.

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

Intercontinental Exchange  vs.  FactSet Research Systems

Intercontinental Exchange

Risk-Adjusted Performance

Weakest

Over the last 90 days Intercontinental Exchange has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

FactSet Research Systems

Risk-Adjusted Performance

Weakest

Over the last 90 days FactSet Research Systems has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain comparatively stable which may send shares a bit higher in November 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Intercontinental and FactSet Research

The main advantage of trading using opposite Intercontinental and FactSet Research positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intercontinental position performs unexpectedly, FactSet Research 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 FactSet Research will offset losses from the drop in FactSet Research's long position.

The idea behind Intercontinental Exchange and FactSet Research Systems 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.