Correlation Between ICON PROPERTIES and BLANTYRE HOTELS

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

By analyzing existing cross correlation between ICON PROPERTIES LIMITED and BLANTYRE HOTELS LIMITED, you can compare the effects of market volatilities on ICON PROPERTIES and BLANTYRE HOTELS 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 PROPERTIES with a short position of BLANTYRE HOTELS. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICON PROPERTIES and BLANTYRE HOTELS.

Diversification Opportunities for ICON PROPERTIES and BLANTYRE HOTELS

0.01

Correlation Coefficient

ICON PROPERTIES  BLANTYRE HOTELS

Significant diversification

The 3 months correlation between ICON and BLANTYRE is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding ICON PROPERTIES LIMITED and BLANTYRE HOTELS LIMITED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BLANTYRE HOTELS and ICON PROPERTIES 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 PROPERTIES LIMITED are associated (or correlated) with BLANTYRE HOTELS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BLANTYRE HOTELS has no effect on the direction of ICON PROPERTIES i.e., ICON PROPERTIES and BLANTYRE HOTELS go up and down completely randomly.

Pair Corralation between ICON PROPERTIES and BLANTYRE HOTELS

Assuming the 90 days trading horizon ICON PROPERTIES LIMITED is expected to under-perform the BLANTYRE HOTELS. In addition to that, ICON PROPERTIES is 1.19 times more volatile than BLANTYRE HOTELS LIMITED. It trades about -0.36 of its total potential returns per unit of risk. BLANTYRE HOTELS LIMITED is currently generating about -0.05 per unit of volatility. If you would invest  1,455  in BLANTYRE HOTELS LIMITED on December 22, 2024 and sell it today you would lose (1.00) from holding BLANTYRE HOTELS LIMITED or give up 0.07% of portfolio value over 90 days.

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

ICON PROPERTIES LIMITED  vs.  BLANTYRE HOTELS LIMITED

ICON PROPERTIES

Risk-Adjusted Performance

Very Weak

Over the last 90 days ICON PROPERTIES LIMITED has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, ICON PROPERTIES is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

BLANTYRE HOTELS

Risk-Adjusted Performance

Very Weak

Over the last 90 days BLANTYRE HOTELS LIMITED has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, BLANTYRE HOTELS is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with ICON PROPERTIES and BLANTYRE HOTELS

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

The idea behind ICON PROPERTIES LIMITED and BLANTYRE HOTELS LIMITED 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.