Correlation Between Lyxor 1 and LUNDIN MINING
Can any of the company-specific risk be diversified away by investing in both Lyxor 1 and LUNDIN MINING 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 LUNDIN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor 1 and LUNDIN MINING, you can compare the effects of market volatilities on Lyxor 1 and LUNDIN MINING 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 LUNDIN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor 1 and LUNDIN MINING.
Diversification Opportunities for Lyxor 1 and LUNDIN MINING
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lyxor and LUNDIN is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor 1 and LUNDIN MINING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LUNDIN MINING 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 LUNDIN MINING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LUNDIN MINING has no effect on the direction of Lyxor 1 i.e., Lyxor 1 and LUNDIN MINING go up and down completely randomly.
Pair Corralation between Lyxor 1 and LUNDIN MINING
Assuming the 90 days trading horizon Lyxor 1 is expected to generate 2.44 times less return on investment than LUNDIN MINING. But when comparing it to its historical volatility, Lyxor 1 is 2.8 times less risky than LUNDIN MINING. It trades about 0.15 of its potential returns per unit of risk. LUNDIN MINING is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 767.00 in LUNDIN MINING on September 12, 2024 and sell it today you would earn a total of 149.00 from holding LUNDIN MINING or generate 19.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyxor 1 vs. LUNDIN MINING
Performance |
| Timeline |
| Lyxor 1 |
| LUNDIN MINING |
Lyxor 1 and LUNDIN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor 1 and LUNDIN MINING
The main advantage of trading using opposite Lyxor 1 and LUNDIN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor 1 position performs unexpectedly, LUNDIN MINING 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 LUNDIN MINING will offset losses from the drop in LUNDIN MINING'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 |
| LUNDIN MINING vs. FANDIFI TECHNOLOGY P | LUNDIN MINING vs. PKSHA TECHNOLOGY INC | LUNDIN MINING vs. Lendlease Group | LUNDIN MINING vs. United Rentals |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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