Correlation Between Lyxor Japan and 21Shares Bitcoin
Can any of the company-specific risk be diversified away by investing in both Lyxor Japan and 21Shares Bitcoin 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 Japan and 21Shares Bitcoin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor Japan UCITS and 21Shares Bitcoin Suisse, you can compare the effects of market volatilities on Lyxor Japan and 21Shares Bitcoin 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 Japan with a short position of 21Shares Bitcoin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor Japan and 21Shares Bitcoin.
Diversification Opportunities for Lyxor Japan and 21Shares Bitcoin
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lyxor and 21Shares is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor Japan UCITS and 21Shares Bitcoin Suisse in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 21Shares Bitcoin Suisse and Lyxor Japan 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 Japan UCITS are associated (or correlated) with 21Shares Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 21Shares Bitcoin Suisse has no effect on the direction of Lyxor Japan i.e., Lyxor Japan and 21Shares Bitcoin go up and down completely randomly.
Pair Corralation between Lyxor Japan and 21Shares Bitcoin
Assuming the 90 days trading horizon Lyxor Japan is expected to generate 3.47 times less return on investment than 21Shares Bitcoin. But when comparing it to its historical volatility, Lyxor Japan UCITS is 2.4 times less risky than 21Shares Bitcoin. It trades about 0.07 of its potential returns per unit of risk. 21Shares Bitcoin Suisse is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 943.00 in 21Shares Bitcoin Suisse on November 1, 2024 and sell it today you would earn a total of 2,487 from holding 21Shares Bitcoin Suisse or generate 263.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 89.05% |
| Values | Daily Returns |
Lyxor Japan UCITS vs. 21Shares Bitcoin Suisse
Performance |
| Timeline |
| Lyxor Japan UCITS |
| 21Shares Bitcoin Suisse |
Lyxor Japan and 21Shares Bitcoin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor Japan and 21Shares Bitcoin
The main advantage of trading using opposite Lyxor Japan and 21Shares Bitcoin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor Japan position performs unexpectedly, 21Shares Bitcoin 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 21Shares Bitcoin will offset losses from the drop in 21Shares Bitcoin's long position.| Lyxor Japan vs. Lyxor Japan UCITS | Lyxor Japan vs. Lyxor Euro Government | Lyxor Japan vs. Lyxor MSCI China |
| 21Shares Bitcoin vs. UBSFund Solutions MSCI | 21Shares Bitcoin vs. Vanguard SP 500 | 21Shares Bitcoin vs. iShares VII PLC | 21Shares Bitcoin vs. iShares Core SP |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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