Correlation Between Lyxor UCITS and 21Shares Crypto
Can any of the company-specific risk be diversified away by investing in both Lyxor UCITS and 21Shares Crypto 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 21Shares Crypto into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor UCITS Stoxx and 21Shares Crypto Basket, you can compare the effects of market volatilities on Lyxor UCITS and 21Shares Crypto 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 21Shares Crypto. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor UCITS and 21Shares Crypto.
Diversification Opportunities for Lyxor UCITS and 21Shares Crypto
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lyxor and 21Shares is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor UCITS Stoxx and 21Shares Crypto Basket in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 21Shares Crypto Basket 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 Stoxx are associated (or correlated) with 21Shares Crypto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 21Shares Crypto Basket has no effect on the direction of Lyxor UCITS i.e., Lyxor UCITS and 21Shares Crypto go up and down completely randomly.
Pair Corralation between Lyxor UCITS and 21Shares Crypto
Assuming the 90 days trading horizon Lyxor UCITS is expected to generate 23.79 times less return on investment than 21Shares Crypto. But when comparing it to its historical volatility, Lyxor UCITS Stoxx is 5.53 times less risky than 21Shares Crypto. It trades about 0.06 of its potential returns per unit of risk. 21Shares Crypto Basket is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 1,543 in 21Shares Crypto Basket on September 12, 2024 and sell it today you would earn a total of 1,729 from holding 21Shares Crypto Basket or generate 112.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyxor UCITS Stoxx vs. 21Shares Crypto Basket
Performance |
| Timeline |
| Lyxor UCITS Stoxx |
| 21Shares Crypto Basket |
Lyxor UCITS and 21Shares Crypto Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor UCITS and 21Shares Crypto
The main advantage of trading using opposite Lyxor UCITS and 21Shares Crypto positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor UCITS position performs unexpectedly, 21Shares Crypto 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 Crypto will offset losses from the drop in 21Shares Crypto's long position.| Lyxor UCITS vs. Lyxor Index Fund | Lyxor UCITS vs. Multi Units France | Lyxor UCITS vs. Lyxor UCITS MSCI | Lyxor UCITS vs. Multi Units France |
| 21Shares Crypto vs. Lyxor UCITS Japan | 21Shares Crypto vs. Lyxor UCITS Japan | 21Shares Crypto vs. Lyxor UCITS Stoxx | 21Shares Crypto 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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