Correlation Between Internet Gold and Icon

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

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

Diversification Opportunities for Internet Gold and Icon

0.35

Correlation Coefficient

Internet Gold  Icon

Weak diversification

The 3 months correlation between Internet and Icon is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Internet Gold Golden and Icon Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icon Group and Internet Gold 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 Internet Gold Golden are associated (or correlated) with Icon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icon Group has no effect on the direction of Internet Gold i.e., Internet Gold and Icon go up and down completely randomly.

Pair Corralation between Internet Gold and Icon

Assuming the 90 days trading horizon Internet Gold Golden is expected to generate 1.49 times more return on investment than Icon. However, Internet Gold is 1.49 times more volatile than Icon Group. It trades about 0.11 of its potential returns per unit of risk. Icon Group is currently generating about 0.07 per unit of risk. If you would invest  35,590  in Internet Gold Golden on April 24, 2025 and sell it today you would earn a total of  8,850  from holding Internet Gold Golden or generate 24.87% return on investment over 90 days.

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

Internet Gold Golden  vs.  Icon Group

Internet Gold Golden

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Internet Gold Golden are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Internet Gold sustained solid returns over the last few months and may actually be approaching a breakup point.

Icon Group

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Icon Group are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Icon sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Internet Gold and Icon

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

The idea behind Internet Gold Golden and Icon Group 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.