Correlation Between Exmar NV and Ion Beam

Can any of the company-specific risk be diversified away by investing in both Exmar 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 Exmar 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 Exmar NV and Ion Beam Applications, you can compare the effects of market volatilities on Exmar 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 Exmar NV with a short position of Ion Beam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exmar NV and Ion Beam.

Diversification Opportunities for Exmar NV and Ion Beam

-0.24

Correlation Coefficient

Exmar NV  Ion Beam

Very good diversification

The 3 months correlation between Exmar and Ion is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Exmar 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 Exmar 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 Exmar 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 Exmar NV i.e., Exmar NV and Ion Beam go up and down completely randomly.

Pair Corralation between Exmar NV and Ion Beam

Assuming the 90 days trading horizon Exmar NV is expected to generate 0.15 times more return on investment than Ion Beam. However, Exmar NV is 6.79 times less risky than Ion Beam. It trades about 0.03 of its potential returns per unit of risk. Ion Beam Applications is currently generating about -0.11 per unit of risk. If you would invest  1,146  in Exmar NV on December 28, 2024 and sell it today you would earn a total of  8.00  from holding Exmar NV or generate 0.7% return on investment over 90 days.

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

Exmar NV  vs.  Ion Beam Applications

Exmar NV

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Exmar NV are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable primary indicators, Exmar NV is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Ion Beam Applications

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ion Beam Applications has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Exmar NV and Ion Beam

The main advantage of trading using opposite Exmar NV and Ion Beam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exmar 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.

The idea behind Exmar NV and Ion Beam Applications 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.