Correlation Between ICF International and Hub

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

By analyzing existing cross correlation between ICF International and Hub Group, you can compare the effects of market volatilities on ICF International and Hub 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 ICF International with a short position of Hub. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICF International and Hub.

Diversification Opportunities for ICF International and Hub

0.91

Correlation Coefficient

ICF International  Hub

Almost no diversification

The 3 months correlation between ICF and Hub is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding ICF International and Hub Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hub Group and ICF International 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 ICF International are associated (or correlated) with Hub. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hub Group has no effect on the direction of ICF International i.e., ICF International and Hub go up and down completely randomly.

Pair Corralation between ICF International and Hub

Given the investment horizon of 90 days ICF International is expected to under-perform the Hub. In addition to that, ICF International is 2.05 times more volatile than Hub Group. It trades about -0.15 of its total potential returns per unit of risk. Hub Group is currently generating about -0.15 per unit of volatility. If you would invest  4,420  in Hub Group on December 26, 2024 and sell it today you would lose (648.00) from holding Hub Group or give up 14.66% of portfolio value over 90 days.

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

ICF International  vs.  Hub Group

ICF International

Risk-Adjusted Performance

Very Weak

Over the last 90 days ICF International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Hub Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hub Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental drivers remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with ICF International and Hub

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

The idea behind ICF International and Hub Group 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.