Correlation Between BE Semiconductor and Flow Traders
Can any of the company-specific risk be diversified away by investing in both BE Semiconductor and Flow Traders 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 BE Semiconductor and Flow Traders into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BE Semiconductor Industries and Flow Traders NV, you can compare the effects of market volatilities on BE Semiconductor and Flow Traders 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 BE Semiconductor with a short position of Flow Traders. Check out your portfolio center. Please also check ongoing floating volatility patterns of BE Semiconductor and Flow Traders.
Diversification Opportunities for BE Semiconductor and Flow Traders
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 0XVE and Flow is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding BE Semiconductor Industries and Flow Traders NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flow Traders NV and BE Semiconductor 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 BE Semiconductor Industries are associated (or correlated) with Flow Traders. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flow Traders NV has no effect on the direction of BE Semiconductor i.e., BE Semiconductor and Flow Traders go up and down completely randomly.
Pair Corralation between BE Semiconductor and Flow Traders
Assuming the 90 days trading horizon BE Semiconductor Industries is expected to under-perform the Flow Traders. In addition to that, BE Semiconductor is 1.42 times more volatile than Flow Traders NV. It trades about -0.03 of its total potential returns per unit of risk. Flow Traders NV is currently generating about 0.04 per unit of volatility. If you would invest 1,953 in Flow Traders NV on August 28, 2024 and sell it today you would earn a total of 184.00 from holding Flow Traders NV or generate 9.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BE Semiconductor Industries vs. Flow Traders NV
Performance |
| Timeline |
| BE Semiconductor Ind |
| Flow Traders NV |
BE Semiconductor and Flow Traders Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BE Semiconductor and Flow Traders
The main advantage of trading using opposite BE Semiconductor and Flow Traders positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BE Semiconductor position performs unexpectedly, Flow Traders 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 Flow Traders will offset losses from the drop in Flow Traders' long position.| BE Semiconductor vs. Samsung Electronics Co | BE Semiconductor vs. Samsung Electronics Co | BE Semiconductor vs. Hyundai Motor | BE Semiconductor vs. Toyota Motor Corp |
| Flow Traders vs. Panther Metals PLC | Flow Traders vs. Neometals | Flow Traders vs. Morgan Advanced Materials | Flow Traders vs. Applied Materials |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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