Correlation Between Heartland Financial and ASM International
Can any of the company-specific risk be diversified away by investing in both Heartland Financial and ASM International 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 Heartland Financial and ASM International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Heartland Financial USA and ASM International NV, you can compare the effects of market volatilities on Heartland Financial and ASM International 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 Heartland Financial with a short position of ASM International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heartland Financial and ASM International.
Diversification Opportunities for Heartland Financial and ASM International
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Heartland and ASM is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Heartland Financial USA and ASM International NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASM International and Heartland Financial 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 Heartland Financial USA are associated (or correlated) with ASM International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASM International has no effect on the direction of Heartland Financial i.e., Heartland Financial and ASM International go up and down completely randomly.
Pair Corralation between Heartland Financial and ASM International
Assuming the 90 days horizon Heartland Financial USA is expected to generate 1.49 times more return on investment than ASM International. However, Heartland Financial is 1.49 times more volatile than ASM International NV. It trades about 0.28 of its potential returns per unit of risk. ASM International NV is currently generating about -0.05 per unit of risk. If you would invest 5,374 in Heartland Financial USA on September 2, 2024 and sell it today you would earn a total of 976.00 from holding Heartland Financial USA or generate 18.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heartland Financial USA vs. ASM International NV
Performance |
| Timeline |
| Heartland Financial USA |
| ASM International |
Heartland Financial and ASM International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heartland Financial and ASM International
The main advantage of trading using opposite Heartland Financial and ASM International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heartland Financial position performs unexpectedly, ASM International 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 ASM International will offset losses from the drop in ASM International's long position.| Heartland Financial vs. UNICREDIT SPA ADR | Heartland Financial vs. Deutsche Bank Aktiengesellschaft | Heartland Financial vs. Superior Plus Corp | Heartland Financial vs. Origin Agritech |
| ASM International vs. Automatic Data Processing | ASM International vs. GRUPO CARSO A1 | ASM International vs. Datang International Power | ASM International vs. Cass Information Systems |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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