Correlation Between NATIONAL HEALTHCARE and ASML HOLDING

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

By analyzing existing cross correlation between NATIONAL HEALTHCARE and ASML HOLDING NY, you can compare the effects of market volatilities on NATIONAL HEALTHCARE 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 NATIONAL HEALTHCARE with a short position of ASML HOLDING. Check out your portfolio center. Please also check ongoing floating volatility patterns of NATIONAL HEALTHCARE and ASML HOLDING.

Diversification Opportunities for NATIONAL HEALTHCARE and ASML HOLDING

0.74

Correlation Coefficient

NATIONAL HEALTHCARE  ASML HOLDING

Poor diversification

The 3 months correlation between NATIONAL and ASML is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding NATIONAL HEALTHCARE and ASML HOLDING NY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASML HOLDING NY and NATIONAL HEALTHCARE 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 NATIONAL HEALTHCARE 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 NY has no effect on the direction of NATIONAL HEALTHCARE i.e., NATIONAL HEALTHCARE and ASML HOLDING go up and down completely randomly.

Pair Corralation between NATIONAL HEALTHCARE and ASML HOLDING

Assuming the 90 days trading horizon NATIONAL HEALTHCARE is expected to generate 1.06 times less return on investment than ASML HOLDING. But when comparing it to its historical volatility, NATIONAL HEALTHCARE is 1.5 times less risky than ASML HOLDING. It trades about 0.13 of its potential returns per unit of risk. ASML HOLDING NY is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  55,837  in ASML HOLDING NY on April 20, 2025 and sell it today you would earn a total of  7,763  from holding ASML HOLDING NY or generate 13.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.31%
Values	Daily Returns

NATIONAL HEALTHCARE  vs.  ASML HOLDING NY

NATIONAL HEALTHCARE

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in NATIONAL HEALTHCARE are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, NATIONAL HEALTHCARE exhibited solid returns over the last few months and may actually be approaching a breakup point.

ASML HOLDING NY

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ASML HOLDING NY are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile primary indicators, ASML HOLDING reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with NATIONAL HEALTHCARE and ASML HOLDING

The main advantage of trading using opposite NATIONAL HEALTHCARE and ASML HOLDING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NATIONAL HEALTHCARE 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 NATIONAL HEALTHCARE and ASML HOLDING NY 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.