Correlation Between Eurocastle Investment and BE Semiconductor
Can any of the company-specific risk be diversified away by investing in both Eurocastle Investment and BE Semiconductor 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 Eurocastle Investment and BE Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eurocastle Investment and BE Semiconductor Industries, you can compare the effects of market volatilities on Eurocastle Investment and BE Semiconductor 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 Eurocastle Investment with a short position of BE Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eurocastle Investment and BE Semiconductor.
Diversification Opportunities for Eurocastle Investment and BE Semiconductor
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Eurocastle and BESI is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Eurocastle Investment and BE Semiconductor Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BE Semiconductor Ind and Eurocastle Investment 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 Eurocastle Investment are associated (or correlated) with BE Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BE Semiconductor Ind has no effect on the direction of Eurocastle Investment i.e., Eurocastle Investment and BE Semiconductor go up and down completely randomly.
Pair Corralation between Eurocastle Investment and BE Semiconductor
Assuming the 90 days trading horizon Eurocastle Investment is expected to under-perform the BE Semiconductor. In addition to that, Eurocastle Investment is 1.76 times more volatile than BE Semiconductor Industries. It trades about -0.41 of its total potential returns per unit of risk. BE Semiconductor Industries is currently generating about 0.07 per unit of volatility. If you would invest 10,485 in BE Semiconductor Industries on August 30, 2024 and sell it today you would earn a total of 360.00 from holding BE Semiconductor Industries or generate 3.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 45.45% |
| Values | Daily Returns |
Eurocastle Investment vs. BE Semiconductor Industries
Performance |
| Timeline |
| Eurocastle Investment |
| BE Semiconductor Ind |
Eurocastle Investment and BE Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eurocastle Investment and BE Semiconductor
The main advantage of trading using opposite Eurocastle Investment and BE Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eurocastle Investment position performs unexpectedly, BE Semiconductor 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 BE Semiconductor will offset losses from the drop in BE Semiconductor's long position.| Eurocastle Investment vs. Tetragon Financial Group | Eurocastle Investment vs. Ctac NV | Eurocastle Investment vs. Hydratec Industries NV | Eurocastle Investment vs. BlackRock ESG Multi Asset |
| BE Semiconductor vs. Ctac NV | BE Semiconductor vs. Value8 NV | BE Semiconductor vs. New Sources Energy | BE Semiconductor vs. Lavide 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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