Correlation Between Lyxor 1 and Melco Resorts
Can any of the company-specific risk be diversified away by investing in both Lyxor 1 and Melco Resorts 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 Melco Resorts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor 1 and Melco Resorts Entertainment, you can compare the effects of market volatilities on Lyxor 1 and Melco Resorts 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 Melco Resorts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor 1 and Melco Resorts.
Diversification Opportunities for Lyxor 1 and Melco Resorts
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lyxor and Melco is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor 1 and Melco Resorts Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Melco Resorts Entert 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 Melco Resorts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Melco Resorts Entert has no effect on the direction of Lyxor 1 i.e., Lyxor 1 and Melco Resorts go up and down completely randomly.
Pair Corralation between Lyxor 1 and Melco Resorts
Assuming the 90 days trading horizon Lyxor 1 is expected to generate 0.32 times more return on investment than Melco Resorts. However, Lyxor 1 is 3.12 times less risky than Melco Resorts. It trades about 0.46 of its potential returns per unit of risk. Melco Resorts Entertainment is currently generating about -0.06 per unit of risk. If you would invest 2,539 in Lyxor 1 on November 9, 2024 and sell it today you would earn a total of 203.00 from holding Lyxor 1 or generate 8.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyxor 1 vs. Melco Resorts Entertainment
Performance |
| Timeline |
| Lyxor 1 |
| Melco Resorts Entert |
Lyxor 1 and Melco Resorts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor 1 and Melco Resorts
The main advantage of trading using opposite Lyxor 1 and Melco Resorts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor 1 position performs unexpectedly, Melco Resorts 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 Melco Resorts will offset losses from the drop in Melco Resorts' 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 |
| Melco Resorts vs. Electronic Arts | Melco Resorts vs. Samsung Electronics Co | Melco Resorts vs. ARROW ELECTRONICS | Melco Resorts vs. ELECTRONIC ARTS |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |