Correlation Between Lyxor UCITS and IShares VII
Can any of the company-specific risk be diversified away by investing in both Lyxor UCITS and IShares VII 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 IShares VII 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 iShares VII PLC, you can compare the effects of market volatilities on Lyxor UCITS and IShares VII 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 IShares VII. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor UCITS and IShares VII.
Diversification Opportunities for Lyxor UCITS and IShares VII
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lyxor and IShares is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor UCITS Stoxx and iShares VII PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares VII PLC 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 IShares VII. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares VII PLC has no effect on the direction of Lyxor UCITS i.e., Lyxor UCITS and IShares VII go up and down completely randomly.
Pair Corralation between Lyxor UCITS and IShares VII
Assuming the 90 days trading horizon Lyxor UCITS is expected to generate 1.04 times less return on investment than IShares VII. In addition to that, Lyxor UCITS is 1.15 times more volatile than iShares VII PLC. It trades about 0.43 of its total potential returns per unit of risk. iShares VII PLC is currently generating about 0.52 per unit of volatility. If you would invest 765.00 in iShares VII PLC on November 3, 2024 and sell it today you would earn a total of 57.00 from holding iShares VII PLC or generate 7.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyxor UCITS Stoxx vs. iShares VII PLC
Performance |
| Timeline |
| Lyxor UCITS Stoxx |
| iShares VII PLC |
Lyxor UCITS and IShares VII Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor UCITS and IShares VII
The main advantage of trading using opposite Lyxor UCITS and IShares VII positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor UCITS position performs unexpectedly, IShares VII 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 IShares VII will offset losses from the drop in IShares VII's long position.| Lyxor UCITS vs. Lyxor Japan UCITS | Lyxor UCITS vs. Lyxor Euro Government | Lyxor UCITS vs. Lyxor MSCI China | Lyxor UCITS vs. Lyxor MSCI World |
| IShares VII vs. UBSFund Solutions MSCI | IShares VII vs. Vanguard SP 500 | IShares VII vs. iShares VII PLC | IShares VII 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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