Correlation Between DAX Index and Lyxor Index
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By analyzing existing cross correlation between DAX Index and Lyxor Index Fund, you can compare the effects of market volatilities on DAX Index and Lyxor Index 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 Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Lyxor Index.
Diversification Opportunities for DAX Index and Lyxor Index
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DAX and Lyxor is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Lyxor Index Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor Index Fund 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 Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lyxor Index Fund has no effect on the direction of DAX Index i.e., DAX Index and Lyxor Index go up and down completely randomly.
Pair Corralation between DAX Index and Lyxor Index
Assuming the 90 days trading horizon DAX Index is expected to generate 0.88 times more return on investment than Lyxor Index. However, DAX Index is 1.14 times less risky than Lyxor Index. It trades about 0.05 of its potential returns per unit of risk. Lyxor Index Fund is currently generating about 0.01 per unit of risk. If you would invest 1,925,734 in DAX Index on August 31, 2024 and sell it today you would earn a total of 16,839 from holding DAX Index or generate 0.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 63.64% |
| Values | Daily Returns |
DAX Index vs. Lyxor Index Fund
Performance |
| Timeline |
DAX Index and Lyxor Index Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Lyxor Index Fund
Pair trading matchups for Lyxor Index
Pair Trading with DAX Index and Lyxor Index
The main advantage of trading using opposite DAX Index and Lyxor Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Lyxor Index 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 Index will offset losses from the drop in Lyxor Index's long position.| DAX Index vs. Magnachip Semiconductor | DAX Index vs. Taiwan Semiconductor Manufacturing | DAX Index vs. Broadcom | DAX Index vs. MagnaChip Semiconductor Corp |
| Lyxor Index vs. UBS Fund Solutions | Lyxor Index vs. Xtrackers II | Lyxor Index vs. Xtrackers Nikkei 225 | Lyxor Index vs. iShares VII PLC |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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