Correlation Between Lyxor Smart and UBS Barclays
Can any of the company-specific risk be diversified away by investing in both Lyxor Smart and UBS Barclays 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 Smart and UBS Barclays into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor Smart Overnight and UBS Barclays Liquid, you can compare the effects of market volatilities on Lyxor Smart and UBS Barclays 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 Smart with a short position of UBS Barclays. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor Smart and UBS Barclays.
Diversification Opportunities for Lyxor Smart and UBS Barclays
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lyxor and UBS is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor Smart Overnight and UBS Barclays Liquid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS Barclays Liquid and Lyxor Smart 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 Smart Overnight are associated (or correlated) with UBS Barclays. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS Barclays Liquid has no effect on the direction of Lyxor Smart i.e., Lyxor Smart and UBS Barclays go up and down completely randomly.
Pair Corralation between Lyxor Smart and UBS Barclays
Assuming the 90 days trading horizon Lyxor Smart Overnight is expected to generate 0.09 times more return on investment than UBS Barclays. However, Lyxor Smart Overnight is 11.56 times less risky than UBS Barclays. It trades about 0.57 of its potential returns per unit of risk. UBS Barclays Liquid is currently generating about -0.11 per unit of risk. If you would invest 120,932 in Lyxor Smart Overnight on August 30, 2024 and sell it today you would earn a total of 1,005 from holding Lyxor Smart Overnight or generate 0.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyxor Smart Overnight vs. UBS Barclays Liquid
Performance |
| Timeline |
| Lyxor Smart Overnight |
| UBS Barclays Liquid |
Lyxor Smart and UBS Barclays Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor Smart and UBS Barclays
The main advantage of trading using opposite Lyxor Smart and UBS Barclays positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor Smart position performs unexpectedly, UBS Barclays 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 UBS Barclays will offset losses from the drop in UBS Barclays' long position.| Lyxor Smart vs. Lyxor UCITS EuroMTS | Lyxor Smart vs. Lyxor Core UK | Lyxor Smart vs. Lyxor Core Global | Lyxor Smart vs. Lyxor UCITS iBoxx |
| UBS Barclays vs. Leverage Shares 3x | UBS Barclays vs. Leverage Shares 3x | UBS Barclays vs. GraniteShares 3x Short | UBS Barclays vs. Leverage Shares 3x |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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