Correlation Between Swiss Leader and Lyxor UCITS
Can any of the company-specific risk be diversified away by investing in both Swiss Leader 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 Swiss Leader and Lyxor UCITS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swiss Leader Price and Lyxor UCITS Stoxx, you can compare the effects of market volatilities on Swiss Leader 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 Swiss Leader with a short position of Lyxor UCITS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swiss Leader and Lyxor UCITS.
Diversification Opportunities for Swiss Leader and Lyxor UCITS
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Swiss and Lyxor is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Swiss Leader Price 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 Swiss Leader 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 Swiss Leader Price 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 Swiss Leader i.e., Swiss Leader and Lyxor UCITS go up and down completely randomly.
Pair Corralation between Swiss Leader and Lyxor UCITS
Assuming the 90 days trading horizon Swiss Leader Price is expected to generate 0.94 times more return on investment than Lyxor UCITS. However, Swiss Leader Price is 1.06 times less risky than Lyxor UCITS. It trades about -0.17 of its potential returns per unit of risk. Lyxor UCITS Stoxx is currently generating about -0.21 per unit of risk. If you would invest 199,681 in Swiss Leader Price on August 28, 2024 and sell it today you would lose (6,391) from holding Swiss Leader Price or give up 3.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Swiss Leader Price vs. Lyxor UCITS Stoxx
Performance |
| Timeline |
Swiss Leader and Lyxor UCITS Volatility Contrast
Predicted Return Density |
| Returns |
Swiss Leader Price
Pair trading matchups for Swiss Leader
Lyxor UCITS Stoxx
Pair trading matchups for Lyxor UCITS
Pair Trading with Swiss Leader and Lyxor UCITS
The main advantage of trading using opposite Swiss Leader and Lyxor UCITS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swiss Leader 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.| Swiss Leader vs. Adval Tech Holding | Swiss Leader vs. mobilezone ag | Swiss Leader vs. Graubuendner Kantonalbank | Swiss Leader vs. Zurich Insurance Group |
| Lyxor UCITS vs. Lyxor Japan UCITS | Lyxor UCITS vs. Lyxor Euro Government | Lyxor UCITS vs. Lyxor MSCI China |
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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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