Correlation Between Aalberts Industries and ASM International
Can any of the company-specific risk be diversified away by investing in both Aalberts Industries 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 Aalberts Industries and ASM International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aalberts Industries NV and ASM International NV, you can compare the effects of market volatilities on Aalberts Industries 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 Aalberts Industries with a short position of ASM International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aalberts Industries and ASM International.
Diversification Opportunities for Aalberts Industries and ASM International
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aalberts and ASM is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Aalberts Industries NV and ASM International NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASM International and Aalberts Industries 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 Aalberts Industries NV 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 Aalberts Industries i.e., Aalberts Industries and ASM International go up and down completely randomly.
Pair Corralation between Aalberts Industries and ASM International
Assuming the 90 days trading horizon Aalberts Industries NV is expected to generate 0.47 times more return on investment than ASM International. However, Aalberts Industries NV is 2.12 times less risky than ASM International. It trades about 0.3 of its potential returns per unit of risk. ASM International NV is currently generating about 0.05 per unit of risk. If you would invest 3,725 in Aalberts Industries NV on February 16, 2024 and sell it today you would earn a total of 1,015 from holding Aalberts Industries NV or generate 27.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Aalberts Industries NV vs. ASM International NV
Performance |
Timeline |
Aalberts Industries |
ASM International |
Aalberts Industries and ASM International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Aalberts Industries and ASM International
The main advantage of trading using opposite Aalberts Industries and ASM International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aalberts Industries 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.Aalberts Industries vs. TKH Group NV | Aalberts Industries vs. Koninklijke Vopak NV | Aalberts Industries vs. Randstad NV | Aalberts Industries vs. SBM Offshore NV |
ASM International vs. BE Semiconductor Industries | ASM International vs. ASML Holding NV | ASM International vs. NN Group NV | ASM International vs. Aalberts Industries NV |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |