Correlation Between 21Shares Polkadot and Lyxor UCITS
Can any of the company-specific risk be diversified away by investing in both 21Shares Polkadot 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 21Shares Polkadot and Lyxor UCITS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 21Shares Polkadot ETP and Lyxor UCITS EuroMTS, you can compare the effects of market volatilities on 21Shares Polkadot 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 21Shares Polkadot with a short position of Lyxor UCITS. Check out your portfolio center. Please also check ongoing floating volatility patterns of 21Shares Polkadot and Lyxor UCITS.
Diversification Opportunities for 21Shares Polkadot and Lyxor UCITS
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 21Shares and Lyxor is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding 21Shares Polkadot ETP and Lyxor UCITS EuroMTS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor UCITS EuroMTS and 21Shares Polkadot 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 21Shares Polkadot ETP 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 EuroMTS has no effect on the direction of 21Shares Polkadot i.e., 21Shares Polkadot and Lyxor UCITS go up and down completely randomly.
Pair Corralation between 21Shares Polkadot and Lyxor UCITS
Assuming the 90 days trading horizon 21Shares Polkadot ETP is expected to under-perform the Lyxor UCITS. In addition to that, 21Shares Polkadot is 19.62 times more volatile than Lyxor UCITS EuroMTS. It trades about 0.0 of its total potential returns per unit of risk. Lyxor UCITS EuroMTS is currently generating about 0.02 per unit of volatility. If you would invest 16,310 in Lyxor UCITS EuroMTS on October 25, 2024 and sell it today you would earn a total of 218.00 from holding Lyxor UCITS EuroMTS or generate 1.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.52% |
| Values | Daily Returns |
21Shares Polkadot ETP vs. Lyxor UCITS EuroMTS
Performance |
| Timeline |
| 21Shares Polkadot ETP |
| Lyxor UCITS EuroMTS |
21Shares Polkadot and Lyxor UCITS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 21Shares Polkadot and Lyxor UCITS
The main advantage of trading using opposite 21Shares Polkadot and Lyxor UCITS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 21Shares Polkadot 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.| 21Shares Polkadot vs. 21Shares Crypto Basket | 21Shares Polkadot vs. 21Shares Decentraland ETP | 21Shares Polkadot vs. 21Shares Uniswap ETP | 21Shares Polkadot vs. 21Shares Crypto Mid Cap |
| Lyxor UCITS vs. Lyxor SP 500 | Lyxor UCITS vs. Lyxor UCITS Daily | Lyxor UCITS vs. Lyxor UCITS MSCI | Lyxor UCITS vs. Lyxor Treasury 10Y |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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