Correlation Between Baloise Holding and Lyxor SMI
Can any of the company-specific risk be diversified away by investing in both Baloise Holding and Lyxor SMI 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 Baloise Holding and Lyxor SMI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baloise Holding AG and Lyxor SMI Daily, you can compare the effects of market volatilities on Baloise Holding and Lyxor SMI 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 Baloise Holding with a short position of Lyxor SMI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baloise Holding and Lyxor SMI.
Diversification Opportunities for Baloise Holding and Lyxor SMI
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Baloise and Lyxor is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Baloise Holding AG and Lyxor SMI Daily in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor SMI Daily and Baloise Holding 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 Baloise Holding AG are associated (or correlated) with Lyxor SMI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lyxor SMI Daily has no effect on the direction of Baloise Holding i.e., Baloise Holding and Lyxor SMI go up and down completely randomly.
Pair Corralation between Baloise Holding and Lyxor SMI
Assuming the 90 days trading horizon Baloise Holding AG is expected to under-perform the Lyxor SMI. But the stock apears to be less risky and, when comparing its historical volatility, Baloise Holding AG is 1.85 times less risky than Lyxor SMI. The stock trades about -0.09 of its potential returns per unit of risk. The Lyxor SMI Daily is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 201.00 in Lyxor SMI Daily on August 29, 2024 and sell it today you would earn a total of 19.00 from holding Lyxor SMI Daily or generate 9.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baloise Holding AG vs. Lyxor SMI Daily
Performance |
| Timeline |
| Baloise Holding AG |
| Lyxor SMI Daily |
Baloise Holding and Lyxor SMI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baloise Holding and Lyxor SMI
The main advantage of trading using opposite Baloise Holding and Lyxor SMI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baloise Holding position performs unexpectedly, Lyxor SMI 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 SMI will offset losses from the drop in Lyxor SMI's long position.| Baloise Holding vs. Swiss Life Holding | Baloise Holding vs. Helvetia Holding AG | Baloise Holding vs. Swisscom AG | Baloise Holding vs. Zurich Insurance Group |
| Lyxor SMI vs. UBSFund Solutions MSCI | Lyxor SMI vs. iShares Core SP | Lyxor SMI vs. iShares Core MSCI | Lyxor SMI vs. Baloise Holding AG |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |