Correlation Between Lyxor UCITS and Lyxor UCITS
Can any of the company-specific risk be diversified away by investing in both Lyxor UCITS and Lyxor UCITS 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 Lyxor UCITS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor UCITS Daily and Lyxor UCITS Stoxx, you can compare the effects of market volatilities on Lyxor UCITS and Lyxor UCITS 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 Lyxor UCITS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor UCITS and Lyxor UCITS.
Diversification Opportunities for Lyxor UCITS and Lyxor UCITS
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lyxor and Lyxor is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor UCITS Daily and Lyxor UCITS Stoxx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor UCITS Stoxx 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 Daily are associated (or correlated) with Lyxor UCITS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lyxor UCITS Stoxx has no effect on the direction of Lyxor UCITS i.e., Lyxor UCITS and Lyxor UCITS go up and down completely randomly.
Pair Corralation between Lyxor UCITS and Lyxor UCITS
Assuming the 90 days trading horizon Lyxor UCITS Daily is expected to under-perform the Lyxor UCITS. In addition to that, Lyxor UCITS is 1.81 times more volatile than Lyxor UCITS Stoxx. It trades about -0.17 of its total potential returns per unit of risk. Lyxor UCITS Stoxx is currently generating about -0.06 per unit of volatility. If you would invest 5,284 in Lyxor UCITS Stoxx on August 31, 2024 and sell it today you would lose (76.00) from holding Lyxor UCITS Stoxx or give up 1.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Lyxor UCITS Daily vs. Lyxor UCITS Stoxx
Performance |
| Timeline |
| Lyxor UCITS Daily |
| Lyxor UCITS Stoxx |
Lyxor UCITS and Lyxor UCITS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor UCITS and Lyxor UCITS
The main advantage of trading using opposite Lyxor UCITS and Lyxor UCITS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor UCITS position performs unexpectedly, Lyxor UCITS 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 UCITS will offset losses from the drop in Lyxor UCITS's long position.| Lyxor UCITS vs. Multi Units France | Lyxor UCITS vs. Lyxor MSCI China | Lyxor UCITS vs. Lyxor Commodities RefinitivCoreCommodity | Lyxor UCITS vs. Manitou BF SA |
| Lyxor UCITS vs. Lyxor Index Fund | Lyxor UCITS vs. Multi Units France | Lyxor UCITS vs. Lyxor UCITS MSCI | Lyxor UCITS vs. Multi Units France |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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