Correlation Between Morgan Stanley and Lyxor 10Y
Can any of the company-specific risk be diversified away by investing in both Morgan Stanley and Lyxor 10Y 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 Morgan Stanley and Lyxor 10Y into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Morgan Stanley Direct and Lyxor 10Y Treasury, you can compare the effects of market volatilities on Morgan Stanley and Lyxor 10Y 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 Morgan Stanley with a short position of Lyxor 10Y. Check out your portfolio center. Please also check ongoing floating volatility patterns of Morgan Stanley and Lyxor 10Y.
Diversification Opportunities for Morgan Stanley and Lyxor 10Y
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Morgan and Lyxor is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Morgan Stanley Direct and Lyxor 10Y Treasury in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor 10Y Treasury and Morgan Stanley 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 Morgan Stanley Direct are associated (or correlated) with Lyxor 10Y. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lyxor 10Y Treasury has no effect on the direction of Morgan Stanley i.e., Morgan Stanley and Lyxor 10Y go up and down completely randomly.
Pair Corralation between Morgan Stanley and Lyxor 10Y
Given the investment horizon of 90 days Morgan Stanley Direct is expected to generate 0.94 times more return on investment than Lyxor 10Y. However, Morgan Stanley Direct is 1.07 times less risky than Lyxor 10Y. It trades about 0.37 of its potential returns per unit of risk. Lyxor 10Y Treasury is currently generating about 0.1 per unit of risk. If you would invest 2,016 in Morgan Stanley Direct on October 20, 2024 and sell it today you would earn a total of 127.00 from holding Morgan Stanley Direct or generate 6.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Morgan Stanley Direct vs. Lyxor 10Y Treasury
Performance |
| Timeline |
| Morgan Stanley Direct |
| Lyxor 10Y Treasury |
Morgan Stanley and Lyxor 10Y Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Morgan Stanley and Lyxor 10Y
The main advantage of trading using opposite Morgan Stanley and Lyxor 10Y positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Morgan Stanley position performs unexpectedly, Lyxor 10Y 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 10Y will offset losses from the drop in Lyxor 10Y's long position.| Morgan Stanley vs. Balchem | Morgan Stanley vs. Sensient Technologies | Morgan Stanley vs. CF Industries Holdings | Morgan Stanley vs. Hertz Global Hldgs |
| Lyxor 10Y vs. Lyxor UCITS Japan | Lyxor 10Y vs. Lyxor UCITS Japan | Lyxor 10Y vs. Lyxor UCITS Stoxx | Lyxor 10Y vs. Amundi CAC 40 |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |