Correlation Between Icon Energy and Globus Maritime

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

By analyzing existing cross correlation between Icon Energy Corp and Globus Maritime, you can compare the effects of market volatilities on Icon Energy and Globus Maritime 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 Energy with a short position of Globus Maritime. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icon Energy and Globus Maritime.

Diversification Opportunities for Icon Energy and Globus Maritime

-0.43

Correlation Coefficient

Icon Energy  Globus Maritime

Very good diversification

The 3 months correlation between Icon and Globus is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Icon Energy Corp and Globus Maritime in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globus Maritime and Icon Energy 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 Energy Corp are associated (or correlated) with Globus Maritime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globus Maritime has no effect on the direction of Icon Energy i.e., Icon Energy and Globus Maritime go up and down completely randomly.

Pair Corralation between Icon Energy and Globus Maritime

Given the investment horizon of 90 days Icon Energy Corp is expected to generate 1.79 times more return on investment than Globus Maritime. However, Icon Energy is 1.79 times more volatile than Globus Maritime. It trades about -0.04 of its potential returns per unit of risk. Globus Maritime is currently generating about -0.09 per unit of risk. If you would invest  358.00  in Icon Energy Corp on September 12, 2024 and sell it today you would lose (113.00) from holding Icon Energy Corp or give up 31.56% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	43.15%
Values	Daily Returns

Icon Energy Corp  vs.  Globus Maritime

Icon Energy Corp

Risk-Adjusted Performance

3 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Icon Energy Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Icon Energy displayed solid returns over the last few months and may actually be approaching a breakup point.

Globus Maritime

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Globus Maritime has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental drivers remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Icon Energy and Globus Maritime

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

The idea behind Icon Energy Corp and Globus Maritime 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.