Correlation Between Lyxor 1 and Silvercorp Metals
Can any of the company-specific risk be diversified away by investing in both Lyxor 1 and Silvercorp Metals 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 Silvercorp Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor 1 and Silvercorp Metals, you can compare the effects of market volatilities on Lyxor 1 and Silvercorp Metals 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 Silvercorp Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor 1 and Silvercorp Metals.
Diversification Opportunities for Lyxor 1 and Silvercorp Metals
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lyxor and Silvercorp is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor 1 and Silvercorp Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silvercorp Metals 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 Silvercorp Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silvercorp Metals has no effect on the direction of Lyxor 1 i.e., Lyxor 1 and Silvercorp Metals go up and down completely randomly.
Pair Corralation between Lyxor 1 and Silvercorp Metals
Assuming the 90 days trading horizon Lyxor 1 is expected to generate 6.77 times less return on investment than Silvercorp Metals. But when comparing it to its historical volatility, Lyxor 1 is 3.01 times less risky than Silvercorp Metals. It trades about 0.07 of its potential returns per unit of risk. Silvercorp Metals is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 320.00 in Silvercorp Metals on December 7, 2024 and sell it today you would earn a total of 31.00 from holding Silvercorp Metals or generate 9.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Lyxor 1 vs. Silvercorp Metals
Performance |
| Timeline |
| Lyxor 1 |
| Silvercorp Metals |
Lyxor 1 and Silvercorp Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor 1 and Silvercorp Metals
The main advantage of trading using opposite Lyxor 1 and Silvercorp Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor 1 position performs unexpectedly, Silvercorp Metals 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 Silvercorp Metals will offset losses from the drop in Silvercorp Metals' 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 |
| Silvercorp Metals vs. Kingdee International Software | Silvercorp Metals vs. Verizon Communications | Silvercorp Metals vs. Vishay Intertechnology | Silvercorp Metals vs. Mobilezone Holding AG |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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