Correlation Between Icon Financial and Loomis Sayles

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

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

Diversification Opportunities for Icon Financial and Loomis Sayles

-0.24

Correlation Coefficient

Icon Financial  Loomis Sayles

Very good diversification

The 3 months correlation between Icon and Loomis is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Icon Financial Fund and Loomis Sayles Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Investment and Icon Financial 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 Icon Financial Fund are associated (or correlated) with Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles Investment has no effect on the direction of Icon Financial i.e., Icon Financial and Loomis Sayles go up and down completely randomly.

Pair Corralation between Icon Financial and Loomis Sayles

Assuming the 90 days horizon Icon Financial Fund is expected to under-perform the Loomis Sayles. In addition to that, Icon Financial is 3.69 times more volatile than Loomis Sayles Investment. It trades about -0.07 of its total potential returns per unit of risk. Loomis Sayles Investment is currently generating about 0.14 per unit of volatility. If you would invest  962.00  in Loomis Sayles Investment on December 20, 2024 and sell it today you would earn a total of  22.00  from holding Loomis Sayles Investment or generate 2.29% return on investment over 90 days.

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

Icon Financial Fund  vs.  Loomis Sayles Investment

Icon Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Icon Financial Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Icon Financial is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Loomis Sayles Investment

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Loomis Sayles Investment are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Loomis Sayles is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Icon Financial and Loomis Sayles

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

The idea behind Icon Financial Fund and Loomis Sayles Investment 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.