Correlation Between Boston Omaha and ASML Holding
Can any of the company-specific risk be diversified away by investing in both Boston Omaha 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 Boston Omaha and ASML Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Omaha Corp and ASML Holding NV, you can compare the effects of market volatilities on Boston Omaha 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 Boston Omaha with a short position of ASML Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Omaha and ASML Holding.
Diversification Opportunities for Boston Omaha and ASML Holding
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Boston and ASML is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Boston Omaha Corp 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 Boston Omaha 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 Boston Omaha Corp 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 Boston Omaha i.e., Boston Omaha and ASML Holding go up and down completely randomly.
Pair Corralation between Boston Omaha and ASML Holding
Considering the 90-day investment horizon Boston Omaha Corp is expected to under-perform the ASML Holding. But the stock apears to be less risky and, when comparing its historical volatility, Boston Omaha Corp is 1.27 times less risky than ASML Holding. The stock trades about -0.05 of its potential returns per unit of risk. The ASML Holding NV is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 59,070 in ASML Holding NV on August 28, 2024 and sell it today you would earn a total of 9,377 from holding ASML Holding NV or generate 15.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boston Omaha Corp vs. ASML Holding NV
Performance |
| Timeline |
| Boston Omaha Corp |
| ASML Holding NV |
Boston Omaha and ASML Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Omaha and ASML Holding
The main advantage of trading using opposite Boston Omaha and ASML Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Omaha 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.| Boston Omaha vs. Integral Ad Science | Boston Omaha vs. Cardlytics | Boston Omaha vs. Cimpress NV | Boston Omaha vs. QuinStreet |
| ASML Holding vs. Applied Materials | ASML Holding vs. KLA Tencor | ASML Holding vs. Axcelis Technologies | ASML Holding vs. Teradyne |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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