Correlation Between Arqit Quantum and ASM International

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Can any of the company-specific risk be diversified away by investing in both Arqit Quantum 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 Arqit Quantum and ASM International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arqit Quantum and ASM International NV, you can compare the effects of market volatilities on Arqit Quantum 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 Arqit Quantum with a short position of ASM International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arqit Quantum and ASM International.

Diversification Opportunities for Arqit Quantum and ASM International

0.46
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Arqit and ASMIY is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Arqit Quantum and ASM International NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASM International and Arqit Quantum 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 Arqit Quantum 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 Arqit Quantum i.e., Arqit Quantum and ASM International go up and down completely randomly.

Pair Corralation between Arqit Quantum and ASM International

Given the investment horizon of 90 days Arqit Quantum is expected to generate 2.41 times more return on investment than ASM International. However, Arqit Quantum is 2.41 times more volatile than ASM International NV. It trades about 0.03 of its potential returns per unit of risk. ASM International NV is currently generating about 0.04 per unit of risk. If you would invest  960.00  in Arqit Quantum on September 10, 2022 and sell it today you would lose (262.00)  from holding Arqit Quantum or give up 27.29% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy86.12%
ValuesDaily Returns

Arqit Quantum  vs.  ASM International NV

 Performance (%) 
       Timeline  
Arqit Quantum 
Arqit Performance
1 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Arqit Quantum are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting basic indicators, Arqit Quantum may actually be approaching a critical reversion point that can send shares even higher in January 2023.

Arqit Price Channel

ASM International 
ASMIY Performance
0 of 100
Over the last 90 days ASM International NV has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong forward indicators, ASM International is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

ASMIY Price Channel

Arqit Quantum and ASM International Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Arqit Quantum and ASM International

The main advantage of trading using opposite Arqit Quantum and ASM International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arqit Quantum 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.
Arqit Quantum vs. Coca-Cola Co
Arqit Quantum vs. Stemtech
Arqit Quantum vs. Ennis Inc
Arqit Quantum vs. Merck Company
The idea behind Arqit Quantum 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.
ASM International vs. Coca-Cola Co
ASM International vs. Stemtech
ASM International vs. Ennis Inc
ASM International vs. Merck Company
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.

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