Correlation Between DAX Index and Lyxor 1
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By analyzing existing cross correlation between DAX Index and Lyxor 1 , you can compare the effects of market volatilities on DAX Index and Lyxor 1 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 DAX Index with a short position of Lyxor 1. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Lyxor 1.
Diversification Opportunities for DAX Index and Lyxor 1
Very poor diversification
The 3 months correlation between DAX and Lyxor is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Lyxor 1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor 1 and DAX Index 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 DAX Index are associated (or correlated) with Lyxor 1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lyxor 1 has no effect on the direction of DAX Index i.e., DAX Index and Lyxor 1 go up and down completely randomly.
Pair Corralation between DAX Index and Lyxor 1
Assuming the 90 days trading horizon DAX Index is expected to generate 0.86 times more return on investment than Lyxor 1. However, DAX Index is 1.17 times less risky than Lyxor 1. It trades about 0.09 of its potential returns per unit of risk. Lyxor 1 is currently generating about 0.0 per unit of risk. If you would invest 1,690,376 in DAX Index on August 28, 2024 and sell it today you would earn a total of 250,144 from holding DAX Index or generate 14.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.53% |
| Values | Daily Returns |
DAX Index vs. Lyxor 1
Performance |
| Timeline |
DAX Index and Lyxor 1 Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Lyxor 1
Pair trading matchups for Lyxor 1
Pair Trading with DAX Index and Lyxor 1
The main advantage of trading using opposite DAX Index and Lyxor 1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Lyxor 1 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 Lyxor 1 will offset losses from the drop in Lyxor 1's long position.| DAX Index vs. ELMOS SEMICONDUCTOR | DAX Index vs. ALTAIR RES INC | DAX Index vs. Fair Isaac Corp | DAX Index vs. Taiwan Semiconductor Manufacturing |
| Lyxor 1 vs. Lyxor Fed Funds | Lyxor 1 vs. Lyxor BofAML USD | Lyxor 1 vs. Lyxor 1 TecDAX | Lyxor 1 vs. Lyxor UCITS EuroMTS |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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