Correlation Between Lyxor 1 and Centene Corp
Can any of the company-specific risk be diversified away by investing in both Lyxor 1 and Centene Corp 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 Centene Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor 1 and Centene Corp, you can compare the effects of market volatilities on Lyxor 1 and Centene Corp 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 Centene Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor 1 and Centene Corp.
Diversification Opportunities for Lyxor 1 and Centene Corp
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lyxor and Centene is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor 1 and Centene Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Centene 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 Centene Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Centene Corp has no effect on the direction of Lyxor 1 i.e., Lyxor 1 and Centene Corp go up and down completely randomly.
Pair Corralation between Lyxor 1 and Centene Corp
Assuming the 90 days trading horizon Lyxor 1 is expected to under-perform the Centene Corp. But the etf apears to be less risky and, when comparing its historical volatility, Lyxor 1 is 4.57 times less risky than Centene Corp. The etf trades about -0.09 of its potential returns per unit of risk. The Centene Corp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 5,625 in Centene Corp on August 24, 2024 and sell it today you would lose (38.00) from holding Centene Corp or give up 0.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Lyxor 1 vs. Centene Corp
Performance |
| Timeline |
| Lyxor 1 |
| Centene Corp |
Lyxor 1 and Centene Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor 1 and Centene Corp
The main advantage of trading using opposite Lyxor 1 and Centene Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor 1 position performs unexpectedly, Centene Corp 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 Centene Corp will offset losses from the drop in Centene Corp'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 |
| Centene Corp vs. CVS Health Corp | Centene Corp vs. Humana Inc | Centene Corp vs. Medicover AB | Centene Corp vs. Ramsay Gnrale de |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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