Correlation Between Ossiam ESG and Ossiam Lux

Can any of the company-specific risk be diversified away by investing in both Ossiam ESG and Ossiam Lux 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 Ossiam ESG and Ossiam Lux into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ossiam ESG Shiller and Ossiam Lux Barclays, you can compare the effects of market volatilities on Ossiam ESG and Ossiam Lux 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 Ossiam ESG with a short position of Ossiam Lux. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ossiam ESG and Ossiam Lux.

Diversification Opportunities for Ossiam ESG and Ossiam Lux

-0.56

Correlation Coefficient

Ossiam ESG  Ossiam Lux

Excellent diversification

The 3 months correlation between Ossiam and Ossiam is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Ossiam ESG Shiller and Ossiam Lux Barclays in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ossiam Lux Barclays and Ossiam ESG 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 Ossiam ESG Shiller are associated (or correlated) with Ossiam Lux. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ossiam Lux Barclays has no effect on the direction of Ossiam ESG i.e., Ossiam ESG and Ossiam Lux go up and down completely randomly.

Pair Corralation between Ossiam ESG and Ossiam Lux

Assuming the 90 days trading horizon Ossiam ESG Shiller is expected to generate 0.82 times more return on investment than Ossiam Lux. However, Ossiam ESG Shiller is 1.23 times less risky than Ossiam Lux. It trades about -0.03 of its potential returns per unit of risk. Ossiam Lux Barclays is currently generating about -0.23 per unit of risk. If you would invest  9,620  in Ossiam ESG Shiller on September 27, 2024 and sell it today you would lose (38.00) from holding Ossiam ESG Shiller or give up 0.4% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Ossiam ESG Shiller  vs.  Ossiam Lux Barclays

Ossiam ESG Shiller

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ossiam ESG Shiller has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Etf's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the fund shareholders.

Ossiam Lux Barclays

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ossiam Lux Barclays are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Ossiam Lux is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Ossiam ESG and Ossiam Lux

The main advantage of trading using opposite Ossiam ESG and Ossiam Lux positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ossiam ESG position performs unexpectedly, Ossiam Lux 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 Ossiam Lux will offset losses from the drop in Ossiam Lux's long position.

The idea behind Ossiam ESG Shiller and Ossiam Lux Barclays pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.