Correlation Between Greentown Management and ASML Holding
Can any of the company-specific risk be diversified away by investing in both Greentown Management 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 Greentown Management and ASML Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greentown Management Holdings and ASML Holding NV, you can compare the effects of market volatilities on Greentown Management 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 Greentown Management with a short position of ASML Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greentown Management and ASML Holding.
Diversification Opportunities for Greentown Management and ASML Holding
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Greentown and ASML is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Greentown Management Holdings 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 Greentown Management 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 Greentown Management Holdings 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 Greentown Management i.e., Greentown Management and ASML Holding go up and down completely randomly.
Pair Corralation between Greentown Management and ASML Holding
Assuming the 90 days horizon Greentown Management Holdings is expected to generate 1.88 times more return on investment than ASML Holding. However, Greentown Management is 1.88 times more volatile than ASML Holding NV. It trades about 0.05 of its potential returns per unit of risk. ASML Holding NV is currently generating about -0.02 per unit of risk. If you would invest 34.00 in Greentown Management Holdings on November 4, 2024 and sell it today you would earn a total of 16.00 from holding Greentown Management Holdings or generate 47.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Greentown Management Holdings vs. ASML Holding NV
Performance |
| Timeline |
| Greentown Management |
| ASML Holding NV |
Greentown Management and ASML Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greentown Management and ASML Holding
The main advantage of trading using opposite Greentown Management and ASML Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greentown Management 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.| Greentown Management vs. Church Dwight | Greentown Management vs. Newell Brands | Greentown Management vs. Borr Drilling | Greentown Management vs. World Houseware Limited |
| 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 Global Correlations module to find global opportunities by holding instruments from different markets.
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