Correlation Between Lyxor 1 and Townsquare Media
Can any of the company-specific risk be diversified away by investing in both Lyxor 1 and Townsquare Media 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 Townsquare Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor 1 and Townsquare Media, you can compare the effects of market volatilities on Lyxor 1 and Townsquare Media 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 Townsquare Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor 1 and Townsquare Media.
Diversification Opportunities for Lyxor 1 and Townsquare Media
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lyxor and Townsquare is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor 1 and Townsquare Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Townsquare Media 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 Townsquare Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Townsquare Media has no effect on the direction of Lyxor 1 i.e., Lyxor 1 and Townsquare Media go up and down completely randomly.
Pair Corralation between Lyxor 1 and Townsquare Media
Assuming the 90 days trading horizon Lyxor 1 is expected to under-perform the Townsquare Media. But the etf apears to be less risky and, when comparing its historical volatility, Lyxor 1 is 2.26 times less risky than Townsquare Media. The etf trades about -0.15 of its potential returns per unit of risk. The Townsquare Media is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,061 in Townsquare Media on February 1, 2024 and sell it today you would earn a total of 69.00 from holding Townsquare Media or generate 6.5% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Lyxor 1 vs. Townsquare Media
Performance |
Timeline |
Lyxor 1 |
Townsquare Media |
Lyxor 1 and Townsquare Media Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lyxor 1 and Townsquare Media
The main advantage of trading using opposite Lyxor 1 and Townsquare Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor 1 position performs unexpectedly, Townsquare Media 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 Townsquare Media will offset losses from the drop in Townsquare Media's long position.Lyxor 1 vs. Lyxor Fed Funds | Lyxor 1 vs. Lyxor BofAML USD | Lyxor 1 vs. Lyxor Index Fund | Lyxor 1 vs. Lyxor 1 TecDAX |
Townsquare Media vs. Lyxor 1 | Townsquare Media vs. Xtrackers ShortDAX | Townsquare Media vs. Xtrackers LevDAX |
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 Stocks Directory module to find actively traded stocks across global markets.
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