Correlation Between Lyxor MSCI and Vanguard USD
Can any of the company-specific risk be diversified away by investing in both Lyxor MSCI and Vanguard USD 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 MSCI and Vanguard USD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor MSCI Europe and Vanguard USD Corp, you can compare the effects of market volatilities on Lyxor MSCI and Vanguard USD 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 MSCI with a short position of Vanguard USD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor MSCI and Vanguard USD.
Diversification Opportunities for Lyxor MSCI and Vanguard USD
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lyxor and Vanguard is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor MSCI Europe and Vanguard USD Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard USD Corp and Lyxor MSCI 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 MSCI Europe are associated (or correlated) with Vanguard USD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard USD Corp has no effect on the direction of Lyxor MSCI i.e., Lyxor MSCI and Vanguard USD go up and down completely randomly.
Pair Corralation between Lyxor MSCI and Vanguard USD
Assuming the 90 days trading horizon Lyxor MSCI Europe is expected to under-perform the Vanguard USD. In addition to that, Lyxor MSCI is 22.88 times more volatile than Vanguard USD Corp. It trades about -0.03 of its total potential returns per unit of risk. Vanguard USD Corp is currently generating about -0.01 per unit of volatility. If you would invest 4,373 in Vanguard USD Corp on August 30, 2024 and sell it today you would lose (26.00) from holding Vanguard USD Corp or give up 0.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Lyxor MSCI Europe vs. Vanguard USD Corp
Performance |
| Timeline |
| Lyxor MSCI Europe |
| Vanguard USD Corp |
Lyxor MSCI and Vanguard USD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor MSCI and Vanguard USD
The main advantage of trading using opposite Lyxor MSCI and Vanguard USD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor MSCI position performs unexpectedly, Vanguard USD 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 Vanguard USD will offset losses from the drop in Vanguard USD's long position.| Lyxor MSCI vs. UBSFund Solutions MSCI | Lyxor MSCI vs. iShares Core SP | Lyxor MSCI vs. Baloise Holding AG | Lyxor MSCI vs. Autoneum Holding AG |
| Vanguard USD vs. UBSFund Solutions MSCI | Vanguard USD vs. iShares Core SP | Vanguard USD vs. Baloise Holding AG | Vanguard USD vs. Autoneum 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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