Correlation Between Lyxor 1 and Superior Plus
Can any of the company-specific risk be diversified away by investing in both Lyxor 1 and Superior Plus 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 Superior Plus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor 1 and Superior Plus Corp, you can compare the effects of market volatilities on Lyxor 1 and Superior Plus 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 Superior Plus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor 1 and Superior Plus.
Diversification Opportunities for Lyxor 1 and Superior Plus
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lyxor and Superior is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor 1 and Superior Plus Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Superior Plus Corp 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 Superior Plus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Superior Plus Corp has no effect on the direction of Lyxor 1 i.e., Lyxor 1 and Superior Plus go up and down completely randomly.
Pair Corralation between Lyxor 1 and Superior Plus
Assuming the 90 days trading horizon Lyxor 1 is expected to generate 0.19 times more return on investment than Superior Plus. However, Lyxor 1 is 5.37 times less risky than Superior Plus. It trades about -0.07 of its potential returns per unit of risk. Superior Plus Corp is currently generating about -0.01 per unit of risk. If you would invest 2,492 in Lyxor 1 on August 28, 2024 and sell it today you would lose (36.00) from holding Lyxor 1 or give up 1.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyxor 1 vs. Superior Plus Corp
Performance |
| Timeline |
| Lyxor 1 |
| Superior Plus Corp |
Lyxor 1 and Superior Plus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor 1 and Superior Plus
The main advantage of trading using opposite Lyxor 1 and Superior Plus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor 1 position performs unexpectedly, Superior Plus 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 Superior Plus will offset losses from the drop in Superior Plus' long position.| Lyxor 1 vs. Lyxor Fed Funds | Lyxor 1 vs. Lyxor BofAML USD | Lyxor 1 vs. Lyxor 1 TecDAX | Lyxor 1 vs. Lyxor UCITS EuroMTS |
| Superior Plus vs. CDL INVESTMENT | Superior Plus vs. ECHO INVESTMENT ZY | Superior Plus vs. SEI INVESTMENTS | Superior Plus vs. Gruppo Mutuionline SpA |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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