Correlation Between ASML Holding and VanEck Global
Can any of the company-specific risk be diversified away by investing in both ASML Holding and VanEck Global 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 VanEck Global 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 VanEck Global Real, you can compare the effects of market volatilities on ASML Holding and VanEck Global 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 VanEck Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASML Holding and VanEck Global.
Diversification Opportunities for ASML Holding and VanEck Global
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ASML and VanEck is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding ASML Holding NV and VanEck Global Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Global Real 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 VanEck Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Global Real has no effect on the direction of ASML Holding i.e., ASML Holding and VanEck Global go up and down completely randomly.
Pair Corralation between ASML Holding and VanEck Global
Assuming the 90 days trading horizon ASML Holding NV is expected to under-perform the VanEck Global. In addition to that, ASML Holding is 4.05 times more volatile than VanEck Global Real. It trades about -0.08 of its total potential returns per unit of risk. VanEck Global Real is currently generating about 0.16 per unit of volatility. If you would invest 3,577 in VanEck Global Real on September 3, 2024 and sell it today you would earn a total of 567.00 from holding VanEck Global Real or generate 15.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ASML Holding NV vs. VanEck Global Real
Performance |
| Timeline |
| ASML Holding NV |
| VanEck Global Real |
ASML Holding and VanEck Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASML Holding and VanEck Global
The main advantage of trading using opposite ASML Holding and VanEck Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASML Holding position performs unexpectedly, VanEck Global 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 VanEck Global will offset losses from the drop in VanEck Global'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 |
| VanEck Global vs. Vanguard FTSE Developed | VanEck Global vs. HSBC MSCI Japan | VanEck Global vs. iShares II Public | VanEck Global vs. Hydratec Industries 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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