Correlation Between Manitou BF and Lyxor UCITS

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Manitou BF 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 Manitou BF and Lyxor UCITS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manitou BF SA and Lyxor UCITS EuroMTS, you can compare the effects of market volatilities on Manitou BF 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 Manitou BF with a short position of Lyxor UCITS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manitou BF and Lyxor UCITS.

Diversification Opportunities for Manitou BF and Lyxor UCITS

-0.28
  Correlation Coefficient

Very good diversification

The 3 months correlation between Manitou and Lyxor is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Manitou BF SA and Lyxor UCITS EuroMTS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor UCITS EuroMTS and Manitou BF 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 Manitou BF SA 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 EuroMTS has no effect on the direction of Manitou BF i.e., Manitou BF and Lyxor UCITS go up and down completely randomly.

Pair Corralation between Manitou BF and Lyxor UCITS

Assuming the 90 days trading horizon Manitou BF SA is expected to generate 10.53 times more return on investment than Lyxor UCITS. However, Manitou BF is 10.53 times more volatile than Lyxor UCITS EuroMTS. It trades about 0.05 of its potential returns per unit of risk. Lyxor UCITS EuroMTS is currently generating about -0.47 per unit of risk. If you would invest  1,724  in Manitou BF SA on October 11, 2024 and sell it today you would earn a total of  34.00  from holding Manitou BF SA or generate 1.97% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy95.0%
ValuesDaily Returns

Manitou BF SA  vs.  Lyxor UCITS EuroMTS

 Performance 
       Timeline  
Manitou BF SA 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Manitou BF SA are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Manitou BF is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Lyxor UCITS EuroMTS 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Lyxor UCITS EuroMTS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong forward indicators, Lyxor UCITS is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Manitou BF and Lyxor UCITS Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Manitou BF and Lyxor UCITS

The main advantage of trading using opposite Manitou BF and Lyxor UCITS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manitou BF 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.
The idea behind Manitou BF SA and Lyxor UCITS EuroMTS 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.

Other Complementary Tools

Price Transformation
Use Price Transformation models to analyze the depth of different equity instruments across global markets
Portfolio Backtesting
Avoid under-diversification and over-optimization by backtesting your portfolios
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Equity Valuation
Check real value of public entities based on technical and fundamental data