Correlation Between Aegon NV and ASR Nederland
Can any of the company-specific risk be diversified away by investing in both Aegon NV and ASR Nederland 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 Aegon NV and ASR Nederland into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aegon NV and ASR Nederland NV, you can compare the effects of market volatilities on Aegon NV and ASR Nederland 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 Aegon NV with a short position of ASR Nederland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegon NV and ASR Nederland.
Diversification Opportunities for Aegon NV and ASR Nederland
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aegon and ASR is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Aegon NV and ASR Nederland NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASR Nederland NV and Aegon NV 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 Aegon NV are associated (or correlated) with ASR Nederland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASR Nederland NV has no effect on the direction of Aegon NV i.e., Aegon NV and ASR Nederland go up and down completely randomly.
Pair Corralation between Aegon NV and ASR Nederland
Assuming the 90 days trading horizon Aegon NV is expected to generate 0.97 times more return on investment than ASR Nederland. However, Aegon NV is 1.04 times less risky than ASR Nederland. It trades about 0.46 of its potential returns per unit of risk. ASR Nederland NV is currently generating about 0.24 per unit of risk. If you would invest 581.00 in Aegon NV on November 3, 2024 and sell it today you would earn a total of 50.00 from holding Aegon NV or generate 8.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aegon NV vs. ASR Nederland NV
Performance |
| Timeline |
| Aegon NV |
| ASR Nederland NV |
Aegon NV and ASR Nederland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegon NV and ASR Nederland
The main advantage of trading using opposite Aegon NV and ASR Nederland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegon NV position performs unexpectedly, ASR Nederland 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 ASR Nederland will offset losses from the drop in ASR Nederland's long position.| Aegon NV vs. ING Groep NV | Aegon NV vs. Koninklijke KPN NV | Aegon NV vs. ABN Amro Group | Aegon NV vs. NN Group NV |
| ASR Nederland vs. NN Group NV | ASR Nederland vs. Koninklijke Ahold Delhaize | ASR Nederland vs. BE Semiconductor Industries | ASR Nederland vs. Aegon NV |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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