Correlation Between GraniteShares and Lyxor UCITS
Can any of the company-specific risk be diversified away by investing in both GraniteShares and Lyxor UCITS 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 GraniteShares and Lyxor UCITS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GraniteShares 3x Short and Lyxor UCITS iBoxx, you can compare the effects of market volatilities on GraniteShares and Lyxor UCITS 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 GraniteShares with a short position of Lyxor UCITS. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares and Lyxor UCITS.
Diversification Opportunities for GraniteShares and Lyxor UCITS
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between GraniteShares and Lyxor is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares 3x Short and Lyxor UCITS iBoxx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor UCITS iBoxx and GraniteShares 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 GraniteShares 3x Short are associated (or correlated) with Lyxor UCITS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lyxor UCITS iBoxx has no effect on the direction of GraniteShares i.e., GraniteShares and Lyxor UCITS go up and down completely randomly.
Pair Corralation between GraniteShares and Lyxor UCITS
Assuming the 90 days trading horizon GraniteShares 3x Short is expected to generate 103.11 times more return on investment than Lyxor UCITS. However, GraniteShares is 103.11 times more volatile than Lyxor UCITS iBoxx. It trades about 0.03 of its potential returns per unit of risk. Lyxor UCITS iBoxx is currently generating about 0.01 per unit of risk. If you would invest 14,650 in GraniteShares 3x Short on August 31, 2024 and sell it today you would lose (12,881) from holding GraniteShares 3x Short or give up 87.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 96.03% |
| Values | Daily Returns |
GraniteShares 3x Short vs. Lyxor UCITS iBoxx
Performance |
| Timeline |
| GraniteShares 3x Short |
| Lyxor UCITS iBoxx |
GraniteShares and Lyxor UCITS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GraniteShares and Lyxor UCITS
The main advantage of trading using opposite GraniteShares and Lyxor UCITS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares position performs unexpectedly, Lyxor UCITS 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 UCITS will offset losses from the drop in Lyxor UCITS's long position.| GraniteShares vs. WisdomTree Natural Gas | GraniteShares vs. Leverage Shares 3x | GraniteShares vs. WisdomTree Natural Gas | GraniteShares vs. WisdomTree SP 500 |
| Lyxor UCITS vs. Leverage Shares 3x | Lyxor UCITS vs. WisdomTree Natural Gas | Lyxor UCITS vs. GraniteShares 3x Short | Lyxor UCITS vs. Leverage Shares 3x |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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