Correlation Between 191219BE3 and ICC Holdings

Can any of the company-specific risk be diversified away by investing in both 191219BE3 and ICC Holdings 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 191219BE3 and ICC Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between COCA A ENTERPRISES and ICC Holdings, you can compare the effects of market volatilities on 191219BE3 and ICC Holdings 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 191219BE3 with a short position of ICC Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of 191219BE3 and ICC Holdings.

Diversification Opportunities for 191219BE3 and ICC Holdings

-0.28

Correlation Coefficient

191219BE3  ICC Holdings

Very good diversification

The 3 months correlation between 191219BE3 and ICC is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding COCA A ENTERPRISES and ICC Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICC Holdings and 191219BE3 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 COCA A ENTERPRISES are associated (or correlated) with ICC Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ICC Holdings has no effect on the direction of 191219BE3 i.e., 191219BE3 and ICC Holdings go up and down completely randomly.

Pair Corralation between 191219BE3 and ICC Holdings

Assuming the 90 days trading horizon COCA A ENTERPRISES is expected to generate 1.25 times more return on investment than ICC Holdings. However, 191219BE3 is 1.25 times more volatile than ICC Holdings. It trades about 0.2 of its potential returns per unit of risk. ICC Holdings is currently generating about 0.01 per unit of risk. If you would invest  10,838  in COCA A ENTERPRISES on October 13, 2024 and sell it today you would earn a total of  343.00  from holding COCA A ENTERPRISES or generate 3.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	84.21%
Values	Daily Returns

COCA A ENTERPRISES  vs.  ICC Holdings

COCA A ENTERPRISES

Risk-Adjusted Performance

6 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in COCA A ENTERPRISES are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, 191219BE3 is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

ICC Holdings

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ICC Holdings are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong fundamental indicators, ICC Holdings is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with 191219BE3 and ICC Holdings

The main advantage of trading using opposite 191219BE3 and ICC Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 191219BE3 position performs unexpectedly, ICC Holdings 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 ICC Holdings will offset losses from the drop in ICC Holdings' long position.

The idea behind COCA A ENTERPRISES and ICC Holdings 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.