Correlation Between ASML Holding and TWFG,

Can any of the company-specific risk be diversified away by investing in both ASML Holding and TWFG, 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 ASML Holding and TWFG, 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 TWFG, Class A, you can compare the effects of market volatilities on ASML Holding and TWFG, 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 TWFG,. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASML Holding and TWFG,.

Diversification Opportunities for ASML Holding and TWFG,

-0.61

Correlation Coefficient

ASML Holding  TWFG,

Excellent diversification

The 3 months correlation between ASML and TWFG, is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding ASML Holding NV and TWFG, Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TWFG, Class A and ASML Holding 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 ASML Holding NV are associated (or correlated) with TWFG,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TWFG, Class A has no effect on the direction of ASML Holding i.e., ASML Holding and TWFG, go up and down completely randomly.

Pair Corralation between ASML Holding and TWFG,

Given the investment horizon of 90 days ASML Holding NV is expected to under-perform the TWFG,. In addition to that, ASML Holding is 1.08 times more volatile than TWFG, Class A. It trades about -0.04 of its total potential returns per unit of risk. TWFG, Class A is currently generating about -0.03 per unit of volatility. If you would invest  2,916  in TWFG, Class A on October 10, 2024 and sell it today you would lose (204.00) from holding TWFG, Class A or give up 7.0% of portfolio value over 90 days.

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

ASML Holding NV  vs.  TWFG, Class A

ASML Holding NV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ASML Holding NV has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's primary indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

TWFG, Class A

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TWFG, Class A has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, TWFG, is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with ASML Holding and TWFG,

The main advantage of trading using opposite ASML Holding and TWFG, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASML Holding position performs unexpectedly, TWFG, 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 TWFG, will offset losses from the drop in TWFG,'s long position.

The idea behind ASML Holding NV and TWFG, Class A 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.