Correlation Between ASML Holding and IShares VII
Can any of the company-specific risk be diversified away by investing in both ASML Holding and IShares VII 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 ASML Holding and IShares VII into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASML Holding NV and iShares VII Public, you can compare the effects of market volatilities on ASML Holding and IShares VII 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 ASML Holding with a short position of IShares VII. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASML Holding and IShares VII.
Diversification Opportunities for ASML Holding and IShares VII
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ASML and IShares is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding ASML Holding NV and iShares VII Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares VII Public and ASML Holding 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 ASML Holding NV are associated (or correlated) with IShares VII. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares VII Public has no effect on the direction of ASML Holding i.e., ASML Holding and IShares VII go up and down completely randomly.
Pair Corralation between ASML Holding and IShares VII
Assuming the 90 days trading horizon ASML Holding NV is expected to under-perform the IShares VII. In addition to that, ASML Holding is 1.07 times more volatile than iShares VII Public. It trades about -0.19 of its total potential returns per unit of risk. iShares VII Public is currently generating about -0.09 per unit of volatility. If you would invest 13,178 in iShares VII Public on January 15, 2025 and sell it today you would lose (722.00) from holding iShares VII Public or give up 5.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
ASML Holding NV vs. iShares VII Public
Performance |
| Timeline |
| ASML Holding NV |
| iShares VII Public |
ASML Holding and IShares VII Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASML Holding and IShares VII
The main advantage of trading using opposite ASML Holding and IShares VII positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASML Holding position performs unexpectedly, IShares VII 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 IShares VII will offset losses from the drop in IShares VII's long position.| ASML Holding vs. Adyen NV | ASML Holding vs. Prosus NV | ASML Holding vs. Koninklijke Philips NV | ASML Holding vs. Koninklijke Ahold Delhaize |
| IShares VII vs. iShares MSCI EM | IShares VII vs. iShares III Public | IShares VII vs. iShares Core MSCI | IShares VII vs. iShares France Govt |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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