Correlation Between Lyxor Index and Lyxor UCITS
Can any of the company-specific risk be diversified away by investing in both Lyxor Index 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 Lyxor Index and Lyxor UCITS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor Index Fund and Lyxor UCITS FTSE, you can compare the effects of market volatilities on Lyxor Index 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 Lyxor Index with a short position of Lyxor UCITS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor Index and Lyxor UCITS.
Diversification Opportunities for Lyxor Index and Lyxor UCITS
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lyxor and Lyxor is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor Index Fund and Lyxor UCITS FTSE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor UCITS FTSE and Lyxor Index 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 Lyxor Index Fund 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 FTSE has no effect on the direction of Lyxor Index i.e., Lyxor Index and Lyxor UCITS go up and down completely randomly.
Pair Corralation between Lyxor Index and Lyxor UCITS
Assuming the 90 days trading horizon Lyxor Index Fund is expected to under-perform the Lyxor UCITS. But the etf apears to be less risky and, when comparing its historical volatility, Lyxor Index Fund is 1.16 times less risky than Lyxor UCITS. The etf trades about -0.08 of its potential returns per unit of risk. The Lyxor UCITS FTSE is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 3,176 in Lyxor UCITS FTSE on September 2, 2024 and sell it today you would earn a total of 15.00 from holding Lyxor UCITS FTSE or generate 0.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyxor Index Fund vs. Lyxor UCITS FTSE
Performance |
| Timeline |
| Lyxor Index Fund |
| Lyxor UCITS FTSE |
Lyxor Index and Lyxor UCITS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor Index and Lyxor UCITS
The main advantage of trading using opposite Lyxor Index and Lyxor UCITS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor Index 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.| Lyxor Index vs. Lyxor MSCI China | Lyxor Index vs. Manitou BF SA | Lyxor Index vs. Granite 3x LVMH | Lyxor Index vs. 21Shares Polkadot ETP |
| Lyxor UCITS vs. Lyxor MSCI China | Lyxor UCITS vs. Manitou BF SA | Lyxor UCITS vs. Granite 3x LVMH | Lyxor UCITS vs. 21Shares Polkadot ETP |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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