Correlation Between ALIOR BANK and ASM International

Can any of the company-specific risk be diversified away by investing in both ALIOR BANK 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 ALIOR BANK and ASM International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ALIOR BANK and ASM International NV, you can compare the effects of market volatilities on ALIOR BANK 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 ALIOR BANK with a short position of ASM International. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALIOR BANK and ASM International.

Diversification Opportunities for ALIOR BANK and ASM International

-0.02

Correlation Coefficient

ALIOR BANK  ASM International

Good diversification

The 3 months correlation between ALIOR and ASM is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding ALIOR BANK and ASM International NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASM International and ALIOR BANK 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 ALIOR BANK 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 ALIOR BANK i.e., ALIOR BANK and ASM International go up and down completely randomly.

Pair Corralation between ALIOR BANK and ASM International

Assuming the 90 days trading horizon ALIOR BANK is expected to generate 0.64 times more return on investment than ASM International. However, ALIOR BANK is 1.56 times less risky than ASM International. It trades about 0.19 of its potential returns per unit of risk. ASM International NV is currently generating about -0.06 per unit of risk. If you would invest  1,984  in ALIOR BANK on December 3, 2024 and sell it today you would earn a total of  306.00  from holding ALIOR BANK or generate 15.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

ALIOR BANK  vs.  ASM International NV

ALIOR BANK

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ALIOR BANK are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, ALIOR BANK may actually be approaching a critical reversion point that can send shares even higher in April 2025.

ASM International

Risk-Adjusted Performance

Very Weak

Over the last 90 days ASM International NV has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, ASM International is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with ALIOR BANK and ASM International

The main advantage of trading using opposite ALIOR BANK and ASM International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALIOR BANK 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.

The idea behind ALIOR BANK and ASM International NV 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.

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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.