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

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Correlation Coefficient

Lyxor UCITS  IShares VII

Pay attention - limited upside

The 3 months correlation between Lyxor and IShares is 0.0. 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

If you would invest (100.00) in iShares VII PLC on October 1, 2024 and sell it today you would earn a total of  100.00  from holding iShares VII PLC or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Lyxor UCITS Stoxx  vs.  iShares VII PLC

Lyxor UCITS Stoxx

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lyxor UCITS Stoxx has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable technical and fundamental indicators, Lyxor UCITS is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

iShares VII PLC

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in iShares VII PLC are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, IShares VII is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

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.

The idea behind Lyxor UCITS Stoxx and iShares VII PLC 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.

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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.