Correlation Between BE Semiconductor and PostNL NV
Can any of the company-specific risk be diversified away by investing in both BE Semiconductor and PostNL NV 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 PostNL NV 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 PostNL NV, you can compare the effects of market volatilities on BE Semiconductor and PostNL NV 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 PostNL NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of BE Semiconductor and PostNL NV.
Diversification Opportunities for BE Semiconductor and PostNL NV
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BESI and PostNL is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding BE Semiconductor Industries and PostNL NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PostNL NV 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 PostNL NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PostNL NV has no effect on the direction of BE Semiconductor i.e., BE Semiconductor and PostNL NV go up and down completely randomly.
Pair Corralation between BE Semiconductor and PostNL NV
Assuming the 90 days trading horizon BE Semiconductor Industries is expected to generate 1.27 times more return on investment than PostNL NV. However, BE Semiconductor is 1.27 times more volatile than PostNL NV. It trades about 0.18 of its potential returns per unit of risk. PostNL NV is currently generating about -0.18 per unit of risk. If you would invest 10,195 in BE Semiconductor Industries on August 31, 2024 and sell it today you would earn a total of 1,105 from holding BE Semiconductor Industries or generate 10.84% 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. PostNL NV
Performance |
| Timeline |
| BE Semiconductor Ind |
| PostNL NV |
BE Semiconductor and PostNL NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BE Semiconductor and PostNL NV
The main advantage of trading using opposite BE Semiconductor and PostNL NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BE Semiconductor position performs unexpectedly, PostNL NV 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 PostNL NV will offset losses from the drop in PostNL NV's 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 |
| PostNL NV vs. Koninklijke Ahold Delhaize | PostNL NV vs. Bpost NV | PostNL NV vs. Aegon NV | PostNL NV vs. ABN Amro Group |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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