Correlation Between Icad and Franklin Credit

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

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

Diversification Opportunities for Icad and Franklin Credit

-0.32

Correlation Coefficient

Icad Franklin Credit

Very good diversification

The 3 months correlation between Icad and Franklin is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Icad Inc and Franklin Credit Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Credit Mana and Icad 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 Icad Inc are associated (or correlated) with Franklin Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Credit Mana has no effect on the direction of Icad i.e., Icad and Franklin Credit go up and down completely randomly.

Pair Corralation between Icad and Franklin Credit

If you would invest  25.00  in Franklin Credit Management on December 26, 2022 and sell it today you would earn a total of  0.00  from holding Franklin Credit Management or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Icad Inc  vs.  Franklin Credit Management

Icad Inc

Icad Performance

0 of 100

Over the last 90 days Icad Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady 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.

Franklin Credit Mana

Franklin Performance

0 of 100

Over the last 90 days Franklin Credit Management has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2023. The recent disarray may also be a sign of long period up-swing for the firm insiders.

Pair Trading with Icad and Franklin Credit

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

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The idea behind Icad Inc and Franklin Credit Management 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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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .