Correlation Between Icape Holding and Fill Up

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

By analyzing existing cross correlation between Icape Holding and Fill Up Media, you can compare the effects of market volatilities on Icape Holding and Fill Up 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 Icape Holding with a short position of Fill Up. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icape Holding and Fill Up.

Diversification Opportunities for Icape Holding and Fill Up

0.02

Correlation Coefficient

Icape Holding  Fill Up

Significant diversification

The 3 months correlation between Icape and Fill is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Icape Holding and Fill Up Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fill Up Media and Icape Holding 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 Icape Holding are associated (or correlated) with Fill Up. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fill Up Media has no effect on the direction of Icape Holding i.e., Icape Holding and Fill Up go up and down completely randomly.

Pair Corralation between Icape Holding and Fill Up

Assuming the 90 days trading horizon Icape Holding is expected to generate 5.93 times more return on investment than Fill Up. However, Icape Holding is 5.93 times more volatile than Fill Up Media. It trades about 0.23 of its potential returns per unit of risk. Fill Up Media is currently generating about -0.09 per unit of risk. If you would invest  750.00  in Icape Holding on October 21, 2024 and sell it today you would earn a total of  180.00  from holding Icape Holding or generate 24.0% return on investment over 90 days.

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

Icape Holding  vs.  Fill Up Media

Icape Holding

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Icape Holding are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Icape Holding may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Fill Up Media

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Fill Up Media are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Fill Up reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Icape Holding and Fill Up

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

The idea behind Icape Holding and Fill Up Media 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 Global Correlations module to find global opportunities by holding instruments from different markets.