Correlation Between United Natural and ASML HOLDING
Can any of the company-specific risk be diversified away by investing in both United Natural 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 United Natural and ASML HOLDING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Natural Foods and ASML HOLDING NY, you can compare the effects of market volatilities on United Natural 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 United Natural with a short position of ASML HOLDING. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Natural and ASML HOLDING.
Diversification Opportunities for United Natural and ASML HOLDING
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between United and ASML is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding United Natural Foods 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 United Natural 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 United Natural Foods 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 United Natural i.e., United Natural and ASML HOLDING go up and down completely randomly.
Pair Corralation between United Natural and ASML HOLDING
Assuming the 90 days horizon United Natural Foods is expected to generate 1.38 times more return on investment than ASML HOLDING. However, United Natural is 1.38 times more volatile than ASML HOLDING NY. It trades about 0.36 of its potential returns per unit of risk. ASML HOLDING NY is currently generating about -0.04 per unit of risk. If you would invest 1,820 in United Natural Foods on August 29, 2024 and sell it today you would earn a total of 390.00 from holding United Natural Foods or generate 21.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Natural Foods vs. ASML HOLDING NY
Performance |
| Timeline |
| United Natural Foods |
| ASML HOLDING NY |
United Natural and ASML HOLDING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Natural and ASML HOLDING
The main advantage of trading using opposite United Natural and ASML HOLDING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Natural 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.| United Natural vs. DAIRY FARM INTL | United Natural vs. LION ONE METALS | United Natural vs. Sumitomo Mitsui Construction | United Natural vs. WIMFARM SA EO |
| ASML HOLDING vs. Superior Plus Corp | ASML HOLDING vs. NMI Holdings | ASML HOLDING vs. Origin Agritech | ASML HOLDING vs. SIVERS SEMICONDUCTORS AB |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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