Correlation Between ICON Project and HYN

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

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

Diversification Opportunities for ICON Project and HYN

-0.73

Correlation Coefficient

ICON Project  HYN

Pay attention - limited upside

The 3 months correlation between ICON and HYN is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding ICON Project and HYN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HYN and ICON Project 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 Project are associated (or correlated) with HYN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HYN has no effect on the direction of ICON Project i.e., ICON Project and HYN go up and down completely randomly.

Pair Corralation between ICON Project and HYN

If you would invest  3.31  in HYN on January 20, 2024 and sell it today you would earn a total of  0.00  from holding HYN or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	4.55%
Values	Daily Returns

ICON Project  vs.  HYN

ICON Project

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ICON Project are ranked lower than 4 (%) 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.

HYN

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days HYN has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, HYN 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 Project and HYN

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

The idea behind ICON Project and HYN 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.