Correlation Between Lyxor UCITS and Amundi ETF
Can any of the company-specific risk be diversified away by investing in both Lyxor UCITS and Amundi ETF 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 UCITS and Amundi ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor UCITS Dow and Amundi ETF PEA, you can compare the effects of market volatilities on Lyxor UCITS and Amundi ETF 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 UCITS with a short position of Amundi ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor UCITS and Amundi ETF.
Diversification Opportunities for Lyxor UCITS and Amundi ETF
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lyxor and Amundi is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor UCITS Dow and Amundi ETF PEA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi ETF PEA and Lyxor UCITS 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 UCITS Dow are associated (or correlated) with Amundi ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi ETF PEA has no effect on the direction of Lyxor UCITS i.e., Lyxor UCITS and Amundi ETF go up and down completely randomly.
Pair Corralation between Lyxor UCITS and Amundi ETF
Assuming the 90 days trading horizon Lyxor UCITS Dow is expected to generate 1.72 times more return on investment than Amundi ETF. However, Lyxor UCITS is 1.72 times more volatile than Amundi ETF PEA. It trades about 0.39 of its potential returns per unit of risk. Amundi ETF PEA is currently generating about 0.33 per unit of risk. If you would invest 38,955 in Lyxor UCITS Dow on September 3, 2024 and sell it today you would earn a total of 4,365 from holding Lyxor UCITS Dow or generate 11.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyxor UCITS Dow vs. Amundi ETF PEA
Performance |
| Timeline |
| Lyxor UCITS Dow |
| Amundi ETF PEA |
Lyxor UCITS and Amundi ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor UCITS and Amundi ETF
The main advantage of trading using opposite Lyxor UCITS and Amundi ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor UCITS position performs unexpectedly, Amundi ETF 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 ETF will offset losses from the drop in Amundi ETF's long position.| Lyxor UCITS vs. Multi Units Luxembourg | Lyxor UCITS vs. Lyxor UCITS Stoxx | Lyxor UCITS vs. Lyxor MSCI China | Lyxor UCITS vs. Multi Units Luxembourg |
| Amundi ETF vs. Amundi Index Solutions | Amundi ETF vs. Amundi Index Solutions | Amundi ETF vs. Amundi MSCI World | Amundi ETF 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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