Correlation Between IShares Global and Lyxor 1
Can any of the company-specific risk be diversified away by investing in both IShares Global and Lyxor 1 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 IShares Global and Lyxor 1 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Global Clean and Lyxor 1 , you can compare the effects of market volatilities on IShares Global 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 IShares Global with a short position of Lyxor 1. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Global and Lyxor 1.
Diversification Opportunities for IShares Global and Lyxor 1
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between IShares and Lyxor is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding iShares Global Clean and Lyxor 1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor 1 and IShares Global 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 iShares Global Clean 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 IShares Global i.e., IShares Global and Lyxor 1 go up and down completely randomly.
Pair Corralation between IShares Global and Lyxor 1
Assuming the 90 days trading horizon iShares Global Clean is expected to under-perform the Lyxor 1. In addition to that, IShares Global is 1.39 times more volatile than Lyxor 1 . It trades about -0.17 of its total potential returns per unit of risk. Lyxor 1 is currently generating about 0.49 per unit of volatility. If you would invest 2,487 in Lyxor 1 on November 2, 2024 and sell it today you would earn a total of 210.00 from holding Lyxor 1 or generate 8.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Global Clean vs. Lyxor 1
Performance |
| Timeline |
| iShares Global Clean |
| Lyxor 1 |
IShares Global and Lyxor 1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Global and Lyxor 1
The main advantage of trading using opposite IShares Global and Lyxor 1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Global 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.| IShares Global vs. iShares Govt Bond | IShares Global vs. iShares Global AAA AA | IShares Global vs. iShares Smart City | IShares Global vs. iShares Broad High |
| Lyxor 1 vs. Lyxor Fed Funds | Lyxor 1 vs. Lyxor BofAML USD | Lyxor 1 vs. Lyxor Index Fund | Lyxor 1 vs. Lyxor 1 TecDAX |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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