Correlation Between Plastic Omnium and ASML HOLDING
Can any of the company-specific risk be diversified away by investing in both Plastic Omnium 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 Plastic Omnium and ASML HOLDING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Plastic Omnium and ASML HOLDING NY, you can compare the effects of market volatilities on Plastic Omnium 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 Plastic Omnium with a short position of ASML HOLDING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Plastic Omnium and ASML HOLDING.
Diversification Opportunities for Plastic Omnium and ASML HOLDING
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Plastic and ASML is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Plastic Omnium and ASML HOLDING NY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASML HOLDING NY and Plastic Omnium 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 Plastic Omnium 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 NY has no effect on the direction of Plastic Omnium i.e., Plastic Omnium and ASML HOLDING go up and down completely randomly.
Pair Corralation between Plastic Omnium and ASML HOLDING
Assuming the 90 days trading horizon Plastic Omnium is expected to generate 0.81 times more return on investment than ASML HOLDING. However, Plastic Omnium is 1.24 times less risky than ASML HOLDING. It trades about 0.17 of its potential returns per unit of risk. ASML HOLDING NY is currently generating about -0.1 per unit of risk. If you would invest 843.00 in Plastic Omnium on September 13, 2024 and sell it today you would earn a total of 161.00 from holding Plastic Omnium or generate 19.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.73% |
| Values | Daily Returns |
Plastic Omnium vs. ASML HOLDING NY
Performance |
| Timeline |
| Plastic Omnium |
| ASML HOLDING NY |
Plastic Omnium and ASML HOLDING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Plastic Omnium and ASML HOLDING
The main advantage of trading using opposite Plastic Omnium and ASML HOLDING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Plastic Omnium 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.| Plastic Omnium vs. Apple Inc | Plastic Omnium vs. Apple Inc | Plastic Omnium vs. Apple Inc | Plastic Omnium vs. Apple Inc |
| ASML HOLDING vs. Science Applications International | ASML HOLDING vs. Cass Information Systems | ASML HOLDING vs. SALESFORCE INC CDR | ASML HOLDING vs. TERADATA |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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