Correlation Between VGP NV and Ion Beam
Can any of the company-specific risk be diversified away by investing in both VGP NV and Ion Beam 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 VGP NV and Ion Beam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VGP NV and Ion Beam Applications, you can compare the effects of market volatilities on VGP NV and Ion Beam 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 VGP NV with a short position of Ion Beam. Check out your portfolio center. Please also check ongoing floating volatility patterns of VGP NV and Ion Beam.
Diversification Opportunities for VGP NV and Ion Beam
Weak diversification
The 3 months correlation between VGP and Ion is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding VGP NV and Ion Beam Applications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ion Beam Applications and VGP NV 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 VGP NV are associated (or correlated) with Ion Beam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ion Beam Applications has no effect on the direction of VGP NV i.e., VGP NV and Ion Beam go up and down completely randomly.
Pair Corralation between VGP NV and Ion Beam
Assuming the 90 days trading horizon VGP NV is expected to generate 0.78 times more return on investment than Ion Beam. However, VGP NV is 1.28 times less risky than Ion Beam. It trades about 0.01 of its potential returns per unit of risk. Ion Beam Applications is currently generating about -0.01 per unit of risk. If you would invest 8,083 in VGP NV on November 27, 2024 and sell it today you would lose (43.00) from holding VGP NV or give up 0.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VGP NV vs. Ion Beam Applications
Performance |
| Timeline |
| VGP NV |
| Ion Beam Applications |
VGP NV and Ion Beam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VGP NV and Ion Beam
The main advantage of trading using opposite VGP NV and Ion Beam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VGP NV position performs unexpectedly, Ion Beam 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 Ion Beam will offset losses from the drop in Ion Beam's long position.| VGP NV vs. Warehouses de Pauw | VGP NV vs. Sofina Socit Anonyme | VGP NV vs. Aedifica | VGP NV vs. Xior Student Housing |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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