Correlation Between UBS ETF and Lyxor MSCI
Can any of the company-specific risk be diversified away by investing in both UBS ETF and Lyxor 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 UBS ETF and Lyxor MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UBS ETF MSCI and Lyxor MSCI China, you can compare the effects of market volatilities on UBS ETF and Lyxor 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 UBS ETF with a short position of Lyxor MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBS ETF and Lyxor MSCI.
Diversification Opportunities for UBS ETF and Lyxor MSCI
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between UBS and Lyxor is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding UBS ETF MSCI and Lyxor MSCI China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor MSCI China and UBS ETF 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 UBS ETF MSCI are associated (or correlated) with Lyxor MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lyxor MSCI China has no effect on the direction of UBS ETF i.e., UBS ETF and Lyxor MSCI go up and down completely randomly.
Pair Corralation between UBS ETF and Lyxor MSCI
Assuming the 90 days trading horizon UBS ETF is expected to generate 3.49 times less return on investment than Lyxor MSCI. But when comparing it to its historical volatility, UBS ETF MSCI is 3.53 times less risky than Lyxor MSCI. It trades about 0.07 of its potential returns per unit of risk. Lyxor MSCI China is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,526 in Lyxor MSCI China on September 20, 2024 and sell it today you would earn a total of 35.00 from holding Lyxor MSCI China or generate 2.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
UBS ETF MSCI vs. Lyxor MSCI China
Performance |
| Timeline |
| UBS ETF MSCI |
| Lyxor MSCI China |
UBS ETF and Lyxor MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UBS ETF and Lyxor MSCI
The main advantage of trading using opposite UBS ETF and Lyxor MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UBS ETF position performs unexpectedly, Lyxor 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 Lyxor MSCI will offset losses from the drop in Lyxor MSCI's long position.| UBS ETF vs. Baloise Holding AG | UBS ETF vs. 21Shares Polkadot ETP | UBS ETF vs. BB Biotech AG | UBS ETF vs. Amundi Index Solutions |
| Lyxor MSCI vs. Baloise Holding AG | Lyxor MSCI vs. 21Shares Polkadot ETP | Lyxor MSCI vs. UBS ETF MSCI | Lyxor MSCI vs. BB Biotech 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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