Correlation Between Barclays ETN and Global X
Can any of the company-specific risk be diversified away by investing in both Barclays ETN and Global X 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 Barclays ETN and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barclays ETN Select and Global X Artificial, you can compare the effects of market volatilities on Barclays ETN and Global X 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 Barclays ETN with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barclays ETN and Global X.
Diversification Opportunities for Barclays ETN and Global X
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Barclays and Global is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Barclays ETN Select and Global X Artificial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Artificial and Barclays ETN 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 Barclays ETN Select are associated (or correlated) with Global X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global X Artificial has no effect on the direction of Barclays ETN i.e., Barclays ETN and Global X go up and down completely randomly.
Pair Corralation between Barclays ETN and Global X
Given the investment horizon of 90 days Barclays ETN Select is expected to generate 0.92 times more return on investment than Global X. However, Barclays ETN Select is 1.09 times less risky than Global X. It trades about 0.53 of its potential returns per unit of risk. Global X Artificial is currently generating about 0.16 per unit of risk. If you would invest 2,654 in Barclays ETN Select on August 28, 2024 and sell it today you would earn a total of 330.00 from holding Barclays ETN Select or generate 12.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barclays ETN Select vs. Global X Artificial
Performance |
| Timeline |
| Barclays ETN Select |
| Global X Artificial |
Barclays ETN and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barclays ETN and Global X
The main advantage of trading using opposite Barclays ETN and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barclays ETN position performs unexpectedly, Global X 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 Global X will offset losses from the drop in Global X's long position.| Barclays ETN vs. Alerian Energy Infrastructure | Barclays ETN vs. UBS AG London | Barclays ETN vs. First Trust North | Barclays ETN vs. Tortoise North American |
| Global X vs. Invesco DWA Utilities | Global X vs. Invesco Dynamic Large | Global X vs. Invesco Dynamic Large | Global X vs. HUMANA INC |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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