Correlation Between Boussard and ASML Holding
Can any of the company-specific risk be diversified away by investing in both Boussard and ASML Holding 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 Boussard and ASML Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boussard and Gavaudan and ASML Holding NV, you can compare the effects of market volatilities on Boussard and ASML Holding 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 Boussard with a short position of ASML Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boussard and ASML Holding.
Diversification Opportunities for Boussard and ASML Holding
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Boussard and ASML is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Boussard and Gavaudan and ASML Holding NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASML Holding NV and Boussard 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 Boussard and Gavaudan are associated (or correlated) with ASML Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASML Holding NV has no effect on the direction of Boussard i.e., Boussard and ASML Holding go up and down completely randomly.
Pair Corralation between Boussard and ASML Holding
Assuming the 90 days trading horizon Boussard and Gavaudan is expected to generate 0.53 times more return on investment than ASML Holding. However, Boussard and Gavaudan is 1.87 times less risky than ASML Holding. It trades about 0.06 of its potential returns per unit of risk. ASML Holding NV is currently generating about 0.03 per unit of risk. If you would invest 2,200 in Boussard and Gavaudan on August 28, 2024 and sell it today you would earn a total of 580.00 from holding Boussard and Gavaudan or generate 26.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 74.01% |
| Values | Daily Returns |
Boussard and Gavaudan vs. ASML Holding NV
Performance |
| Timeline |
| Boussard and Gavaudan |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| ASML Holding NV |
Boussard and ASML Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boussard and ASML Holding
The main advantage of trading using opposite Boussard and ASML Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boussard position performs unexpectedly, ASML Holding 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 ASML Holding will offset losses from the drop in ASML Holding's long position.| Boussard vs. NN Group NV | Boussard vs. Koninklijke Ahold Delhaize | Boussard vs. BE Semiconductor Industries | Boussard vs. Aegon NV |
| ASML Holding vs. Adyen NV | ASML Holding vs. Prosus NV | ASML Holding vs. Koninklijke Philips NV | ASML Holding vs. Koninklijke Ahold Delhaize |
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 Stocks Directory module to find actively traded stocks across global markets.
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