Correlation Between TMTG and ICON Project

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

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

Diversification Opportunities for TMTG and ICON Project

0.0

Correlation Coefficient

TMTG  ICON Project

Pay attention - limited upside

The 3 months correlation between TMTG and ICON is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding TMTG and ICON Project in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICON Project and TMTG 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 TMTG 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 TMTG i.e., TMTG and ICON Project go up and down completely randomly.

Pair Corralation between TMTG and ICON Project

If you would invest  29.00  in ICON Project on January 24, 2024 and sell it today you would lose (4.00) from holding ICON Project or give up 13.79% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	68.37%
Values	Daily Returns

TMTG  vs.  ICON Project

TMTG

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TMTG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, TMTG is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

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.

Pair Trading with TMTG and ICON Project

The main advantage of trading using opposite TMTG and ICON Project positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TMTG 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 TMTG 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.

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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.