Correlation Between Alfen Beheer and ASML Holding

Can any of the company-specific risk be diversified away by investing in both Alfen Beheer and ASML Holding 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 Alfen Beheer and ASML Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Alfen Beheer BV and ASML Holding NV, you can compare the effects of market volatilities on Alfen Beheer and ASML Holding 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 Alfen Beheer with a short position of ASML Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alfen Beheer and ASML Holding.

Diversification Opportunities for Alfen Beheer and ASML Holding

-0.63

Correlation Coefficient

Alfen Beheer  ASML Holding

Excellent diversification

The 3 months correlation between Alfen and ASML is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Alfen Beheer BV and ASML Holding NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASML Holding NV and Alfen Beheer 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 Alfen Beheer BV are associated (or correlated) with ASML Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASML Holding NV has no effect on the direction of Alfen Beheer i.e., Alfen Beheer and ASML Holding go up and down completely randomly.

Pair Corralation between Alfen Beheer and ASML Holding

Assuming the 90 days trading horizon Alfen Beheer BV is expected to under-perform the ASML Holding. In addition to that, Alfen Beheer is 1.75 times more volatile than ASML Holding NV. It trades about -0.1 of its total potential returns per unit of risk. ASML Holding NV is currently generating about 0.06 per unit of volatility. If you would invest  58,096  in ASML Holding NV on April 30, 2025 and sell it today you would earn a total of  4,734  from holding ASML Holding NV or generate 8.15% return on investment over 90 days.

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

Alfen Beheer BV  vs.  ASML Holding NV

Alfen Beheer BV

Risk-Adjusted Performance

Very Weak

Over the last 90 days Alfen Beheer BV has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

ASML Holding NV

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ASML Holding NV are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, ASML Holding may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Alfen Beheer and ASML Holding

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

The idea behind Alfen Beheer BV and ASML Holding 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.