Correlation Between Lyxor 1 and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Lyxor 1 and Samsung Electronics 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 Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor 1 and Samsung Electronics Co, you can compare the effects of market volatilities on Lyxor 1 and Samsung Electronics 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 Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor 1 and Samsung Electronics.
Diversification Opportunities for Lyxor 1 and Samsung Electronics
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lyxor and Samsung is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor 1 and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics 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 Samsung Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Electronics has no effect on the direction of Lyxor 1 i.e., Lyxor 1 and Samsung Electronics go up and down completely randomly.
Pair Corralation between Lyxor 1 and Samsung Electronics
Assuming the 90 days trading horizon Lyxor 1 is expected to generate 0.42 times more return on investment than Samsung Electronics. However, Lyxor 1 is 2.36 times less risky than Samsung Electronics. It trades about -0.01 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.05 per unit of risk. If you would invest 2,509 in Lyxor 1 on August 27, 2024 and sell it today you would lose (53.00) from holding Lyxor 1 or give up 2.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyxor 1 vs. Samsung Electronics Co
Performance |
| Timeline |
| Lyxor 1 |
| Samsung Electronics |
Lyxor 1 and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor 1 and Samsung Electronics
The main advantage of trading using opposite Lyxor 1 and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor 1 position performs unexpectedly, Samsung Electronics 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 Samsung Electronics will offset losses from the drop in Samsung Electronics' 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 |
| Samsung Electronics vs. Ryanair Holdings plc | Samsung Electronics vs. DATANG INTL POW | Samsung Electronics vs. National Storage Affiliates | Samsung Electronics vs. WIZZ AIR HLDGUNSPADR4 |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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