Correlation Between BE Semiconductor and Amsterdam Commodities
Can any of the company-specific risk be diversified away by investing in both BE Semiconductor and Amsterdam Commodities 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 BE Semiconductor and Amsterdam Commodities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BE Semiconductor Industries and Amsterdam Commodities NV, you can compare the effects of market volatilities on BE Semiconductor and Amsterdam Commodities 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 BE Semiconductor with a short position of Amsterdam Commodities. Check out your portfolio center. Please also check ongoing floating volatility patterns of BE Semiconductor and Amsterdam Commodities.
Diversification Opportunities for BE Semiconductor and Amsterdam Commodities
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BESI and Amsterdam is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding BE Semiconductor Industries and Amsterdam Commodities NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amsterdam Commodities and BE Semiconductor 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 BE Semiconductor Industries are associated (or correlated) with Amsterdam Commodities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amsterdam Commodities has no effect on the direction of BE Semiconductor i.e., BE Semiconductor and Amsterdam Commodities go up and down completely randomly.
Pair Corralation between BE Semiconductor and Amsterdam Commodities
Assuming the 90 days trading horizon BE Semiconductor Industries is expected to generate 2.57 times more return on investment than Amsterdam Commodities. However, BE Semiconductor is 2.57 times more volatile than Amsterdam Commodities NV. It trades about 0.11 of its potential returns per unit of risk. Amsterdam Commodities NV is currently generating about -0.11 per unit of risk. If you would invest 10,450 in BE Semiconductor Industries on August 29, 2024 and sell it today you would earn a total of 640.00 from holding BE Semiconductor Industries or generate 6.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BE Semiconductor Industries vs. Amsterdam Commodities NV
Performance |
| Timeline |
| BE Semiconductor Ind |
| Amsterdam Commodities |
BE Semiconductor and Amsterdam Commodities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BE Semiconductor and Amsterdam Commodities
The main advantage of trading using opposite BE Semiconductor and Amsterdam Commodities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BE Semiconductor position performs unexpectedly, Amsterdam Commodities 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 Amsterdam Commodities will offset losses from the drop in Amsterdam Commodities' long position.| BE Semiconductor vs. ASM International NV | BE Semiconductor vs. ASML Holding NV | BE Semiconductor vs. ASR Nederland NV | BE Semiconductor vs. Koninklijke Ahold Delhaize |
| Amsterdam Commodities vs. Flow Traders BV | Amsterdam Commodities vs. Aalberts Industries NV | Amsterdam Commodities vs. ForFarmers NV | Amsterdam Commodities vs. TKH Group 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |