Correlation Between Transphorm Technology and ASML Holding
Can any of the company-specific risk be diversified away by investing in both Transphorm Technology 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 Transphorm Technology and ASML Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Transphorm Technology and ASML Holding NV, you can compare the effects of market volatilities on Transphorm Technology 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 Transphorm Technology with a short position of ASML Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Transphorm Technology and ASML Holding.
Diversification Opportunities for Transphorm Technology and ASML Holding
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Transphorm and ASML is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Transphorm Technology 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 Transphorm Technology 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 Transphorm Technology 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 Transphorm Technology i.e., Transphorm Technology and ASML Holding go up and down completely randomly.
Pair Corralation between Transphorm Technology and ASML Holding
If you would invest 71,436 in ASML Holding NV on November 4, 2024 and sell it today you would earn a total of 2,495 from holding ASML Holding NV or generate 3.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 5.0% |
| Values | Daily Returns |
Transphorm Technology vs. ASML Holding NV
Performance |
| Timeline |
| Transphorm Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| ASML Holding NV |
Transphorm Technology and ASML Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Transphorm Technology and ASML Holding
The main advantage of trading using opposite Transphorm Technology and ASML Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Transphorm Technology 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.| Transphorm Technology vs. Sumco Corp ADR | Transphorm Technology vs. Lasertec | Transphorm Technology vs. Asm Pacific Technology | Transphorm Technology vs. Disco Corp ADR |
| 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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