Correlation Between Cyrela Brazil and ASML Holding

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

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

Diversification Opportunities for Cyrela Brazil and ASML Holding

0.08

Correlation Coefficient

Cyrela Brazil  ASML Holding

Significant diversification

The 3 months correlation between Cyrela and ASML is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Cyrela Brazil Realty 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 Cyrela Brazil 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 Cyrela Brazil Realty 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 Cyrela Brazil i.e., Cyrela Brazil and ASML Holding go up and down completely randomly.

Pair Corralation between Cyrela Brazil and ASML Holding

Assuming the 90 days trading horizon Cyrela Brazil is expected to generate 1.04 times less return on investment than ASML Holding. But when comparing it to its historical volatility, Cyrela Brazil Realty is 1.09 times less risky than ASML Holding. It trades about 0.06 of its potential returns per unit of risk. ASML Holding NV is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  6,837  in ASML Holding NV on April 23, 2025 and sell it today you would earn a total of  414.00  from holding ASML Holding NV or generate 6.06% return on investment over 90 days.

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

Cyrela Brazil Realty  vs.  ASML Holding NV

Cyrela Brazil Realty

Risk-Adjusted Performance

Insignificant

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

ASML Holding NV

Risk-Adjusted Performance

OK

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. Despite somewhat weak primary indicators, ASML Holding may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Cyrela Brazil and ASML Holding

The main advantage of trading using opposite Cyrela Brazil and ASML Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cyrela Brazil 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 Cyrela Brazil Realty 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.