Correlation Between Gladstone Investment and Lyxor 1
Can any of the company-specific risk be diversified away by investing in both Gladstone Investment and Lyxor 1 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 Gladstone Investment and Lyxor 1 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gladstone Investment and Lyxor 1 , you can compare the effects of market volatilities on Gladstone Investment and Lyxor 1 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 Gladstone Investment with a short position of Lyxor 1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gladstone Investment and Lyxor 1.
Diversification Opportunities for Gladstone Investment and Lyxor 1
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gladstone and Lyxor is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Gladstone Investment and Lyxor 1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor 1 and Gladstone Investment 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 Gladstone Investment are associated (or correlated) with Lyxor 1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lyxor 1 has no effect on the direction of Gladstone Investment i.e., Gladstone Investment and Lyxor 1 go up and down completely randomly.
Pair Corralation between Gladstone Investment and Lyxor 1
Assuming the 90 days horizon Gladstone Investment is expected to under-perform the Lyxor 1. In addition to that, Gladstone Investment is 2.2 times more volatile than Lyxor 1 . It trades about -0.05 of its total potential returns per unit of risk. Lyxor 1 is currently generating about -0.06 per unit of volatility. If you would invest 2,492 in Lyxor 1 on August 28, 2024 and sell it today you would lose (36.00) from holding Lyxor 1 or give up 1.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gladstone Investment vs. Lyxor 1
Performance |
| Timeline |
| Gladstone Investment |
| Lyxor 1 |
Gladstone Investment and Lyxor 1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gladstone Investment and Lyxor 1
The main advantage of trading using opposite Gladstone Investment and Lyxor 1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gladstone Investment position performs unexpectedly, Lyxor 1 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 Lyxor 1 will offset losses from the drop in Lyxor 1's long position.| Gladstone Investment vs. Lyxor 1 | Gladstone Investment vs. Xtrackers LevDAX | Gladstone Investment vs. Xtrackers ShortDAX |
| Lyxor 1 vs. Lyxor Fed Funds | Lyxor 1 vs. Lyxor BofAML USD | Lyxor 1 vs. Lyxor 1 TecDAX | Lyxor 1 vs. Lyxor UCITS EuroMTS |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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