Correlation Between Icad and IONQ

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

By analyzing existing cross correlation between icad inc and IONQ Inc, you can compare the effects of market volatilities on Icad and IONQ 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 Icad with a short position of IONQ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icad and IONQ.

Diversification Opportunities for Icad and IONQ

0.34

Correlation Coefficient

Icad  IONQ

Weak diversification

The 3 months correlation between Icad and IONQ is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding icad inc and IONQ Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IONQ Inc and Icad 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 icad inc are associated (or correlated) with IONQ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IONQ Inc has no effect on the direction of Icad i.e., Icad and IONQ go up and down completely randomly.

Pair Corralation between Icad and IONQ

Given the investment horizon of 90 days Icad is expected to generate 5.98 times less return on investment than IONQ. But when comparing it to its historical volatility, icad inc is 1.44 times less risky than IONQ. It trades about 0.07 of its potential returns per unit of risk. IONQ Inc is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest  812.00  in IONQ Inc on September 17, 2024 and sell it today you would earn a total of  2,571  from holding IONQ Inc or generate 316.63% return on investment over 90 days.

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

icad inc  vs.  IONQ Inc

icad inc

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in icad inc are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Icad exhibited solid returns over the last few months and may actually be approaching a breakup point.

IONQ Inc

Risk-Adjusted Performance

23 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in IONQ Inc are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent basic indicators, IONQ reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Icad and IONQ

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

The idea behind icad inc and IONQ Inc 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.