Correlation Between Lyxor 1 and SCANDMEDICAL SOLDK

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Can any of the company-specific risk be diversified away by investing in both Lyxor 1 and SCANDMEDICAL SOLDK 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 SCANDMEDICAL SOLDK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor 1 and SCANDMEDICAL SOLDK 040, you can compare the effects of market volatilities on Lyxor 1 and SCANDMEDICAL SOLDK 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 SCANDMEDICAL SOLDK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor 1 and SCANDMEDICAL SOLDK.

Diversification Opportunities for Lyxor 1 and SCANDMEDICAL SOLDK

LyxorSCANDMEDICALDiversified AwayLyxorSCANDMEDICALDiversified Away100%
-0.76
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Lyxor and SCANDMEDICAL is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor 1 and SCANDMEDICAL SOLDK 040 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCANDMEDICAL SOLDK 040 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 SCANDMEDICAL SOLDK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCANDMEDICAL SOLDK 040 has no effect on the direction of Lyxor 1 i.e., Lyxor 1 and SCANDMEDICAL SOLDK go up and down completely randomly.

Pair Corralation between Lyxor 1 and SCANDMEDICAL SOLDK

Assuming the 90 days trading horizon Lyxor 1 is expected to generate 0.38 times more return on investment than SCANDMEDICAL SOLDK. However, Lyxor 1 is 2.63 times less risky than SCANDMEDICAL SOLDK. It trades about 0.05 of its potential returns per unit of risk. SCANDMEDICAL SOLDK 040 is currently generating about -0.04 per unit of risk. If you would invest  2,532  in Lyxor 1 on November 21, 2024 and sell it today you would earn a total of  222.00  from holding Lyxor 1 or generate 8.77% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy97.37%
ValuesDaily Returns

Lyxor 1   vs.  SCANDMEDICAL SOLDK 040

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -15-10-50510
JavaScript chart by amCharts 3.21.15E908 K41
       Timeline  
Lyxor 1 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Over the last 90 days Lyxor 1 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly unsteady basic indicators, Lyxor 1 reported solid returns over the last few months and may actually be approaching a breakup point.
SCANDMEDICAL SOLDK 040 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days SCANDMEDICAL SOLDK 040 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.70.750.80.85

Lyxor 1 and SCANDMEDICAL SOLDK Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-2.47-1.85-1.23-0.610.00.71.42.12.8 0.10.20.30.40.5
JavaScript chart by amCharts 3.21.15E908 K41
       Returns  

Pair Trading with Lyxor 1 and SCANDMEDICAL SOLDK

The main advantage of trading using opposite Lyxor 1 and SCANDMEDICAL SOLDK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor 1 position performs unexpectedly, SCANDMEDICAL SOLDK 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 SCANDMEDICAL SOLDK will offset losses from the drop in SCANDMEDICAL SOLDK's long position.
The idea behind Lyxor 1 and SCANDMEDICAL SOLDK 040 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Transaction History module to view history of all your transactions and understand their impact on performance.

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