Correlation Between BlackRock ETF and Global X
Can any of the company-specific risk be diversified away by investing in both BlackRock ETF 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 BlackRock ETF and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BlackRock ETF Trust and Global X SP, you can compare the effects of market volatilities on BlackRock ETF 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 BlackRock ETF with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlackRock ETF and Global X.
Diversification Opportunities for BlackRock ETF and Global X
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BlackRock and Global is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding BlackRock ETF Trust and Global X SP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X SP and BlackRock ETF 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 BlackRock ETF Trust 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 SP has no effect on the direction of BlackRock ETF i.e., BlackRock ETF and Global X go up and down completely randomly.
Pair Corralation between BlackRock ETF and Global X
Given the investment horizon of 90 days BlackRock ETF is expected to generate 3.09 times less return on investment than Global X. But when comparing it to its historical volatility, BlackRock ETF Trust is 4.96 times less risky than Global X. It trades about 0.24 of its potential returns per unit of risk. Global X SP is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 3,271 in Global X SP on August 26, 2024 and sell it today you would earn a total of 424.00 from holding Global X SP or generate 12.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BlackRock ETF Trust vs. Global X SP
Performance |
| Timeline |
| BlackRock ETF Trust |
| Global X SP |
BlackRock ETF and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BlackRock ETF and Global X
The main advantage of trading using opposite BlackRock ETF and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BlackRock ETF 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.| BlackRock ETF vs. Capital Group Short | BlackRock ETF vs. Capital Group Municipal | BlackRock ETF vs. Capital Group Global | BlackRock ETF vs. Capital Group Dividend |
| Global X vs. BlackRock ETF Trust | Global X vs. Rbb Fund | Global X vs. Virtus ETF Trust | Global X vs. Amplify CWP Enhanced |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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