Correlation Between Lyxor 1 and SSP Group
Can any of the company-specific risk be diversified away by investing in both Lyxor 1 and SSP Group 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 1 and SSP Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor 1 and SSP Group PLC, you can compare the effects of market volatilities on Lyxor 1 and SSP Group 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 1 with a short position of SSP Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor 1 and SSP Group.
Diversification Opportunities for Lyxor 1 and SSP Group
Poor diversification
The 3 months correlation between Lyxor and SSP is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor 1 and SSP Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSP Group PLC and Lyxor 1 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 1 are associated (or correlated) with SSP Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSP Group PLC has no effect on the direction of Lyxor 1 i.e., Lyxor 1 and SSP Group go up and down completely randomly.
Pair Corralation between Lyxor 1 and SSP Group
Assuming the 90 days trading horizon Lyxor 1 is expected to generate 0.39 times more return on investment than SSP Group. However, Lyxor 1 is 2.58 times less risky than SSP Group. It trades about 0.03 of its potential returns per unit of risk. SSP Group PLC is currently generating about -0.03 per unit of risk. If you would invest 2,486 in Lyxor 1 on October 29, 2024 and sell it today you would earn a total of 166.00 from holding Lyxor 1 or generate 6.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyxor 1 vs. SSP Group PLC
Performance |
| Timeline |
| Lyxor 1 |
| SSP Group PLC |
Lyxor 1 and SSP Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor 1 and SSP Group
The main advantage of trading using opposite Lyxor 1 and SSP Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor 1 position performs unexpectedly, SSP Group 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 SSP Group will offset losses from the drop in SSP Group's long position.| Lyxor 1 vs. Lyxor Fed Funds | Lyxor 1 vs. Lyxor BofAML USD | Lyxor 1 vs. Lyxor Index Fund | Lyxor 1 vs. Lyxor 1 TecDAX |
| SSP Group vs. Chiba Bank | SSP Group vs. Zoom Video Communications | SSP Group vs. SUN LIFE FINANCIAL | SSP Group vs. Medical Properties Trust |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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