Correlation Between Binance Coin and ICON Project

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Binance Coin and ICON Project 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 Binance Coin and ICON Project into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Binance Coin and ICON Project, you can compare the effects of market volatilities on Binance Coin and ICON Project 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 Binance Coin with a short position of ICON Project. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binance Coin and ICON Project.

Diversification Opportunities for Binance Coin and ICON Project

0.9
  Correlation Coefficient

Almost no diversification

The 3 months correlation between Binance and ICON is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Binance Coin and ICON Project in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICON Project and Binance Coin 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 Binance Coin are associated (or correlated) with ICON Project. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ICON Project has no effect on the direction of Binance Coin i.e., Binance Coin and ICON Project go up and down completely randomly.

Pair Corralation between Binance Coin and ICON Project

Assuming the 90 days trading horizon Binance Coin is expected to generate 0.57 times more return on investment than ICON Project. However, Binance Coin is 1.76 times less risky than ICON Project. It trades about 0.09 of its potential returns per unit of risk. ICON Project is currently generating about 0.02 per unit of risk. If you would invest  31,080  in Binance Coin on December 29, 2023 and sell it today you would earn a total of  27,120  from holding Binance Coin or generate 87.26% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy100.0%
ValuesDaily Returns

Binance Coin  vs.  ICON Project

 Performance 
       Timeline  
Binance Coin 

Risk-Adjusted Performance

18 of 100

 
Low
 
High
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Binance Coin are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental drivers, Binance Coin exhibited solid returns over the last few months and may actually be approaching a breakup point.
ICON Project 

Risk-Adjusted Performance

8 of 100

 
Low
 
High
OK
Compared to the overall equity markets, risk-adjusted returns on investments in ICON Project are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, ICON Project exhibited solid returns over the last few months and may actually be approaching a breakup point.

Binance Coin and ICON Project Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Binance Coin and ICON Project

The main advantage of trading using opposite Binance Coin and ICON Project positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binance Coin position performs unexpectedly, ICON Project 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 ICON Project will offset losses from the drop in ICON Project's long position.
The idea behind Binance Coin and ICON Project 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.

Other Complementary Tools

My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like
USA ETFs
Find actively traded Exchange Traded Funds (ETF) in USA
Investing Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
ETFs
Find actively traded Exchange Traded Funds (ETF) from around the world
Portfolio Volatility
Check portfolio volatility and analyze historical return density to properly model market risk
Pattern Recognition
Use different Pattern Recognition models to time the market across multiple global exchanges
Equity Search
Search for actively traded equities including funds and ETFs from over 30 global markets
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Funds Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
Watchlist Optimization
Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm
Correlation Analysis
Reduce portfolio risk simply by holding instruments which are not perfectly correlated