Correlation Between Lyxor UCITS and GraniteShares
Can any of the company-specific risk be diversified away by investing in both Lyxor UCITS and GraniteShares 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 UCITS and GraniteShares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor UCITS Japan and GraniteShares 3x Short, you can compare the effects of market volatilities on Lyxor UCITS and GraniteShares 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 UCITS with a short position of GraniteShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor UCITS and GraniteShares.
Diversification Opportunities for Lyxor UCITS and GraniteShares
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lyxor and GraniteShares is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor UCITS Japan and GraniteShares 3x Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GraniteShares 3x Short and Lyxor UCITS 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 UCITS Japan are associated (or correlated) with GraniteShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GraniteShares 3x Short has no effect on the direction of Lyxor UCITS i.e., Lyxor UCITS and GraniteShares go up and down completely randomly.
Pair Corralation between Lyxor UCITS and GraniteShares
Assuming the 90 days trading horizon Lyxor UCITS is expected to generate 46.46 times less return on investment than GraniteShares. But when comparing it to its historical volatility, Lyxor UCITS Japan is 60.53 times less risky than GraniteShares. It trades about 0.05 of its potential returns per unit of risk. GraniteShares 3x Short is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 15,020 in GraniteShares 3x Short on September 2, 2024 and sell it today you would earn a total of 49,205 from holding GraniteShares 3x Short or generate 327.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.4% |
| Values | Daily Returns |
Lyxor UCITS Japan vs. GraniteShares 3x Short
Performance |
| Timeline |
| Lyxor UCITS Japan |
| GraniteShares 3x Short |
Lyxor UCITS and GraniteShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor UCITS and GraniteShares
The main advantage of trading using opposite Lyxor UCITS and GraniteShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor UCITS position performs unexpectedly, GraniteShares 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 GraniteShares will offset losses from the drop in GraniteShares' long position.| Lyxor UCITS vs. GraniteShares 3x Short | Lyxor UCITS vs. WisdomTree Natural Gas | Lyxor UCITS vs. Leverage Shares 3x | Lyxor UCITS vs. WisdomTree Natural Gas |
| GraniteShares vs. GraniteShares 3x Short | GraniteShares vs. GraniteShares 3x Long | GraniteShares vs. GraniteShares 3x Long | GraniteShares vs. GraniteShares 1x Short |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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