Correlation Between Lyxor CAC and IShares MSCI
Can any of the company-specific risk be diversified away by investing in both Lyxor CAC and IShares MSCI 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 IShares MSCI 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 iShares MSCI World, you can compare the effects of market volatilities on Lyxor CAC and IShares MSCI 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 IShares MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor CAC and IShares MSCI.
Diversification Opportunities for Lyxor CAC and IShares MSCI
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lyxor and IShares is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor CAC 40 and iShares MSCI World in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares MSCI World 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 IShares MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares MSCI World has no effect on the direction of Lyxor CAC i.e., Lyxor CAC and IShares MSCI go up and down completely randomly.
Pair Corralation between Lyxor CAC and IShares MSCI
Assuming the 90 days trading horizon Lyxor CAC is expected to generate 2.18 times less return on investment than IShares MSCI. In addition to that, Lyxor CAC is 1.16 times more volatile than iShares MSCI World. It trades about 0.11 of its total potential returns per unit of risk. iShares MSCI World is currently generating about 0.27 per unit of volatility. If you would invest 562.00 in iShares MSCI World on September 19, 2024 and sell it today you would earn a total of 18.00 from holding iShares MSCI World or generate 3.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyxor CAC 40 vs. iShares MSCI World
Performance |
| Timeline |
| Lyxor CAC 40 |
| iShares MSCI World |
Lyxor CAC and IShares MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor CAC and IShares MSCI
The main advantage of trading using opposite Lyxor CAC and IShares MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor CAC position performs unexpectedly, IShares MSCI 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 IShares MSCI will offset losses from the drop in IShares MSCI's long position.| Lyxor CAC vs. Amundi Index Solutions | Lyxor CAC vs. Amundi ETF PEA | Lyxor CAC vs. Amundi ETF PEA | Lyxor CAC vs. Amundi Index Solutions |
| IShares MSCI vs. Lyxor UCITS Japan | IShares MSCI vs. Lyxor UCITS Japan | IShares MSCI vs. Lyxor UCITS Stoxx | IShares MSCI vs. Amundi CAC 40 |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Global Correlations Find global opportunities by holding instruments from different markets |