Correlation Between ASML Holding and Vanguard FTSE
Can any of the company-specific risk be diversified away by investing in both ASML Holding and Vanguard FTSE 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 Vanguard FTSE 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 Vanguard FTSE All World, you can compare the effects of market volatilities on ASML Holding and Vanguard FTSE 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 Vanguard FTSE. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASML Holding and Vanguard FTSE.
Diversification Opportunities for ASML Holding and Vanguard FTSE
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ASML and Vanguard is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding ASML Holding NV and Vanguard FTSE All World in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard FTSE All 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 Vanguard FTSE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard FTSE All has no effect on the direction of ASML Holding i.e., ASML Holding and Vanguard FTSE go up and down completely randomly.
Pair Corralation between ASML Holding and Vanguard FTSE
Assuming the 90 days trading horizon ASML Holding is expected to generate 1.1 times less return on investment than Vanguard FTSE. In addition to that, ASML Holding is 2.73 times more volatile than Vanguard FTSE All World. It trades about 0.08 of its total potential returns per unit of risk. Vanguard FTSE All World is currently generating about 0.24 per unit of volatility. If you would invest 12,762 in Vanguard FTSE All World on August 31, 2024 and sell it today you would earn a total of 624.00 from holding Vanguard FTSE All World or generate 4.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ASML Holding NV vs. Vanguard FTSE All World
Performance |
| Timeline |
| ASML Holding NV |
| Vanguard FTSE All |
ASML Holding and Vanguard FTSE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASML Holding and Vanguard FTSE
The main advantage of trading using opposite ASML Holding and Vanguard FTSE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASML Holding position performs unexpectedly, Vanguard FTSE 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 Vanguard FTSE will offset losses from the drop in Vanguard FTSE'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 |
| Vanguard FTSE vs. iShares Core MSCI | Vanguard FTSE vs. BlackRock ESG Multi Asset | Vanguard FTSE vs. Pershing Square Holdings | Vanguard FTSE vs. ASML Holding 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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