Correlation Between Lyxor CAC and Amundi Nasdaq
Can any of the company-specific risk be diversified away by investing in both Lyxor CAC and Amundi Nasdaq 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 CAC and Amundi Nasdaq into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor CAC 40 and Amundi Nasdaq 100 EUR, you can compare the effects of market volatilities on Lyxor CAC and Amundi Nasdaq 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 CAC with a short position of Amundi Nasdaq. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor CAC and Amundi Nasdaq.
Diversification Opportunities for Lyxor CAC and Amundi Nasdaq
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lyxor and Amundi is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor CAC 40 and Amundi Nasdaq 100 EUR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi Nasdaq 100 and Lyxor CAC 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 CAC 40 are associated (or correlated) with Amundi Nasdaq. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi Nasdaq 100 has no effect on the direction of Lyxor CAC i.e., Lyxor CAC and Amundi Nasdaq go up and down completely randomly.
Pair Corralation between Lyxor CAC and Amundi Nasdaq
Assuming the 90 days trading horizon Lyxor CAC is expected to generate 10.63 times less return on investment than Amundi Nasdaq. In addition to that, Lyxor CAC is 1.05 times more volatile than Amundi Nasdaq 100 EUR. It trades about 0.01 of its total potential returns per unit of risk. Amundi Nasdaq 100 EUR is currently generating about 0.09 per unit of volatility. If you would invest 49,210 in Amundi Nasdaq 100 EUR on September 12, 2024 and sell it today you would earn a total of 800.00 from holding Amundi Nasdaq 100 EUR or generate 1.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Lyxor CAC 40 vs. Amundi Nasdaq 100 EUR
Performance |
| Timeline |
| Lyxor CAC 40 |
| Amundi Nasdaq 100 |
Lyxor CAC and Amundi Nasdaq Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor CAC and Amundi Nasdaq
The main advantage of trading using opposite Lyxor CAC and Amundi Nasdaq positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor CAC position performs unexpectedly, Amundi Nasdaq 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 Amundi Nasdaq will offset losses from the drop in Amundi Nasdaq's long position.| Lyxor CAC vs. Lyxor UCITS Japan | Lyxor CAC vs. Lyxor UCITS Japan | Lyxor CAC vs. Lyxor UCITS Stoxx | Lyxor CAC vs. Amundi CAC 40 |
| Amundi Nasdaq vs. Amundi Index Solutions | Amundi Nasdaq vs. Amundi Index Solutions | Amundi Nasdaq vs. Amundi MSCI World | Amundi Nasdaq vs. Amundi Index Solutions |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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