diversifiable risk of combining ASML Holding and BANORT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASML Holding NV and BANORT 8 38, you can compare the effects of market volatilities on ASML Holding and BANORT 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 ASML Holding with a short position of BANORT. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASML Holding and BANORT.
Diversification Opportunities for ASML Holding and BANORT
Pair Corralation between ASML Holding and BANORT
Given the investment horizon of 90 days ASML Holding NV is expected to generate 2.76 times more return on investment than BANORT. However, ASML Holding is 2.76 times more volatile than BANORT 8 38. It trades about 0.32 of its potential returns per unit of risk. BANORT 8 38 is currently generating about 0.17 per unit of risk. If you would invest 77,723 in ASML Holding NV on November 24, 2023 and sell it today you would earn a total of 13,098 from holding ASML Holding NV or generate 16.85% return on investment over 90 days.
|3 Months [change]
ASML Holding NV vs. BANORT 8 3/8 PERP
ASML Holding and BANORT Volatility Contrast
Pair Trading with ASML Holding and BANORTThe main advantage of trading using opposite ASML Holding and BANORT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASML Holding position performs unexpectedly, BANORT 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 BANORT will offset losses from the drop in BANORT's long position. The idea behind ASML Holding NV and BANORT 8 38 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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