Correlation Between CleanCore Solutions and ICC Holdings

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

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

Diversification Opportunities for CleanCore Solutions and ICC Holdings

0.32

Correlation Coefficient

CleanCore Solutions  ICC Holdings

Weak diversification

The 3 months correlation between CleanCore and ICC is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding CleanCore Solutions and ICC Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICC Holdings and CleanCore Solutions 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 CleanCore Solutions 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 CleanCore Solutions i.e., CleanCore Solutions and ICC Holdings go up and down completely randomly.

Pair Corralation between CleanCore Solutions and ICC Holdings

Given the investment horizon of 90 days CleanCore Solutions is expected to generate 8.69 times more return on investment than ICC Holdings. However, CleanCore Solutions is 8.69 times more volatile than ICC Holdings. It trades about 0.06 of its potential returns per unit of risk. ICC Holdings is currently generating about -0.04 per unit of risk. If you would invest  102.00  in CleanCore Solutions on December 4, 2024 and sell it today you would earn a total of  4.00  from holding CleanCore Solutions or generate 3.92% return on investment over 90 days.

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

CleanCore Solutions  vs.  ICC Holdings

CleanCore Solutions

Risk-Adjusted Performance

Very Weak

Over the last 90 days CleanCore Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

ICC Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days ICC Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. 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 CleanCore Solutions and ICC Holdings

The main advantage of trading using opposite CleanCore Solutions and ICC Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CleanCore Solutions 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 CleanCore Solutions 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.

Check out your portfolio center.

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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.