Correlation Between EVS Broadcast and ASML HOLDING
Can any of the company-specific risk be diversified away by investing in both EVS Broadcast and ASML HOLDING 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 EVS Broadcast and ASML HOLDING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EVS Broadcast Equipment and ASML HOLDING NY, you can compare the effects of market volatilities on EVS Broadcast and ASML HOLDING 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 EVS Broadcast with a short position of ASML HOLDING. Check out your portfolio center. Please also check ongoing floating volatility patterns of EVS Broadcast and ASML HOLDING.
Diversification Opportunities for EVS Broadcast and ASML HOLDING
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between EVS and ASML is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding EVS Broadcast Equipment and ASML HOLDING NY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASML HOLDING NY and EVS Broadcast 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 EVS Broadcast Equipment are associated (or correlated) with ASML HOLDING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASML HOLDING NY has no effect on the direction of EVS Broadcast i.e., EVS Broadcast and ASML HOLDING go up and down completely randomly.
Pair Corralation between EVS Broadcast and ASML HOLDING
Assuming the 90 days trading horizon EVS Broadcast Equipment is expected to generate 0.66 times more return on investment than ASML HOLDING. However, EVS Broadcast Equipment is 1.53 times less risky than ASML HOLDING. It trades about 0.06 of its potential returns per unit of risk. ASML HOLDING NY is currently generating about 0.03 per unit of risk. If you would invest 1,866 in EVS Broadcast Equipment on August 28, 2024 and sell it today you would earn a total of 1,059 from holding EVS Broadcast Equipment or generate 56.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EVS Broadcast Equipment vs. ASML HOLDING NY
Performance |
| Timeline |
| EVS Broadcast Equipment |
| ASML HOLDING NY |
EVS Broadcast and ASML HOLDING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EVS Broadcast and ASML HOLDING
The main advantage of trading using opposite EVS Broadcast and ASML HOLDING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EVS Broadcast position performs unexpectedly, ASML HOLDING 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 ASML HOLDING will offset losses from the drop in ASML HOLDING's long position.| EVS Broadcast vs. Apple Inc | EVS Broadcast vs. Apple Inc | EVS Broadcast vs. Apple Inc | EVS Broadcast vs. Apple Inc |
| ASML HOLDING vs. CARSALESCOM | ASML HOLDING vs. Sims Metal Management | ASML HOLDING vs. Transport International Holdings | ASML HOLDING vs. Perdoceo Education |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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