Correlation Between Tokyo Electron and ASM International
Can any of the company-specific risk be diversified away by investing in both Tokyo Electron and ASM International 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 Tokyo Electron and ASM International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tokyo Electron and ASM International NV, you can compare the effects of market volatilities on Tokyo Electron and ASM International 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 Tokyo Electron with a short position of ASM International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tokyo Electron and ASM International.
Diversification Opportunities for Tokyo Electron and ASM International
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tokyo and ASM is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Tokyo Electron and ASM International NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASM International and Tokyo Electron 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 Tokyo Electron are associated (or correlated) with ASM International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASM International has no effect on the direction of Tokyo Electron i.e., Tokyo Electron and ASM International go up and down completely randomly.
Pair Corralation between Tokyo Electron and ASM International
If you would invest 15,114 in Tokyo Electron on November 3, 2024 and sell it today you would earn a total of 2,066 from holding Tokyo Electron or generate 13.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 5.0% |
| Values | Daily Returns |
Tokyo Electron vs. ASM International NV
Performance |
| Timeline |
| Tokyo Electron |
| ASM International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Tokyo Electron and ASM International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tokyo Electron and ASM International
The main advantage of trading using opposite Tokyo Electron and ASM International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tokyo Electron position performs unexpectedly, ASM International 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 ASM International will offset losses from the drop in ASM International's long position.| Tokyo Electron vs. Origin Materials | Tokyo Electron vs. Codexis | Tokyo Electron vs. The Mosaic | Tokyo Electron vs. Arrow Electronics |
| ASM International vs. Disco Corp ADR | ASM International vs. Asm Pacific Technology | ASM International vs. Sumco Corp ADR | ASM International vs. Lasertec |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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