Correlation Between Lyxor 1 and CONSOL ENERGY
Can any of the company-specific risk be diversified away by investing in both Lyxor 1 and CONSOL ENERGY 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 1 and CONSOL ENERGY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor 1 and CONSOL ENERGY, you can compare the effects of market volatilities on Lyxor 1 and CONSOL ENERGY 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 1 with a short position of CONSOL ENERGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor 1 and CONSOL ENERGY.
Diversification Opportunities for Lyxor 1 and CONSOL ENERGY
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lyxor and CONSOL is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor 1 and CONSOL ENERGY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CONSOL ENERGY and Lyxor 1 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 1 are associated (or correlated) with CONSOL ENERGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CONSOL ENERGY has no effect on the direction of Lyxor 1 i.e., Lyxor 1 and CONSOL ENERGY go up and down completely randomly.
Pair Corralation between Lyxor 1 and CONSOL ENERGY
Assuming the 90 days trading horizon Lyxor 1 is expected to generate 25.18 times less return on investment than CONSOL ENERGY. But when comparing it to its historical volatility, Lyxor 1 is 1.89 times less risky than CONSOL ENERGY. It trades about 0.01 of its potential returns per unit of risk. CONSOL ENERGY is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 1,840 in CONSOL ENERGY on February 19, 2024 and sell it today you would earn a total of 400.00 from holding CONSOL ENERGY or generate 21.74% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Lyxor 1 vs. CONSOL ENERGY
Performance |
Timeline |
Lyxor 1 |
CONSOL ENERGY |
Lyxor 1 and CONSOL ENERGY Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lyxor 1 and CONSOL ENERGY
The main advantage of trading using opposite Lyxor 1 and CONSOL ENERGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor 1 position performs unexpectedly, CONSOL ENERGY 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 CONSOL ENERGY will offset losses from the drop in CONSOL ENERGY's long position.Lyxor 1 vs. UBS Fund Solutions | Lyxor 1 vs. CITIUS RESOURCES LS 005 | Lyxor 1 vs. Superior Plus Corp | Lyxor 1 vs. NMI Holdings |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
Bonds Directory Find actively traded corporate debentures issued by US companies | |
Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
CEOs Directory Screen CEOs from public companies around the world | |
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |