Correlation Between CN LGYPWRGRUNSPADR1 and Lyxor 1
Can any of the company-specific risk be diversified away by investing in both CN LGYPWRGRUNSPADR1 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 CN LGYPWRGRUNSPADR1 and Lyxor 1 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CN LGYPWRGRUNSPADR10 and Lyxor 1 , you can compare the effects of market volatilities on CN LGYPWRGRUNSPADR1 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 CN LGYPWRGRUNSPADR1 with a short position of Lyxor 1. Check out your portfolio center. Please also check ongoing floating volatility patterns of CN LGYPWRGRUNSPADR1 and Lyxor 1.
Diversification Opportunities for CN LGYPWRGRUNSPADR1 and Lyxor 1
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 6WX0 and Lyxor is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding CN LGYPWRGRUNSPADR10 and Lyxor 1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor 1 and CN LGYPWRGRUNSPADR1 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 CN LGYPWRGRUNSPADR10 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 CN LGYPWRGRUNSPADR1 i.e., CN LGYPWRGRUNSPADR1 and Lyxor 1 go up and down completely randomly.
Pair Corralation between CN LGYPWRGRUNSPADR1 and Lyxor 1
Assuming the 90 days trading horizon CN LGYPWRGRUNSPADR10 is expected to generate 3.56 times more return on investment than Lyxor 1. However, CN LGYPWRGRUNSPADR1 is 3.56 times more volatile than Lyxor 1 . It trades about 0.04 of its potential returns per unit of risk. Lyxor 1 is currently generating about 0.02 per unit of risk. If you would invest 567.00 in CN LGYPWRGRUNSPADR10 on September 4, 2024 and sell it today you would earn a total of 133.00 from holding CN LGYPWRGRUNSPADR10 or generate 23.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
CN LGYPWRGRUNSPADR10 vs. Lyxor 1
Performance |
| Timeline |
| CN LGYPWRGRUNSPADR10 |
| Lyxor 1 |
CN LGYPWRGRUNSPADR1 and Lyxor 1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CN LGYPWRGRUNSPADR1 and Lyxor 1
The main advantage of trading using opposite CN LGYPWRGRUNSPADR1 and Lyxor 1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CN LGYPWRGRUNSPADR1 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.| CN LGYPWRGRUNSPADR1 vs. PNE AG | CN LGYPWRGRUNSPADR1 vs. Lyxor 1 | CN LGYPWRGRUNSPADR1 vs. Xtrackers ShortDAX | CN LGYPWRGRUNSPADR1 vs. Xtrackers LevDAX |
| 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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