Correlation Between Valic Company and Icon Financial

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

By analyzing existing cross correlation between Valic Company I and Icon Financial Fund, you can compare the effects of market volatilities on Valic Company and Icon Financial 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 Valic Company with a short position of Icon Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valic Company and Icon Financial.

Diversification Opportunities for Valic Company and Icon Financial

0.86

Correlation Coefficient

Valic Company  Icon Financial

Very poor diversification

The 3 months correlation between Valic and Icon is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Valic Company I and Icon Financial Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icon Financial and Valic Company 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 Valic Company I are associated (or correlated) with Icon Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icon Financial has no effect on the direction of Valic Company i.e., Valic Company and Icon Financial go up and down completely randomly.

Pair Corralation between Valic Company and Icon Financial

Assuming the 90 days horizon Valic Company I is expected to generate 1.46 times more return on investment than Icon Financial. However, Valic Company is 1.46 times more volatile than Icon Financial Fund. It trades about 0.17 of its potential returns per unit of risk. Icon Financial Fund is currently generating about 0.21 per unit of risk. If you would invest  1,139  in Valic Company I on May 25, 2025 and sell it today you would earn a total of  110.00  from holding Valic Company I or generate 9.66% return on investment over 90 days.

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

Valic Company I  vs.  Icon Financial Fund

Valic Company I

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Valic Company I are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Valic Company may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Icon Financial

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Icon Financial Fund are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Icon Financial may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Valic Company and Icon Financial

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

The idea behind Valic Company I and Icon Financial Fund 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.

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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.