Correlation Between Global X and Energisa Mato
Can any of the company-specific risk be diversified away by investing in both Global X and Energisa Mato 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 Global X and Energisa Mato into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Funds and Energisa Mato Grosso, you can compare the effects of market volatilities on Global X and Energisa Mato 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 Global X with a short position of Energisa Mato. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Energisa Mato.
Diversification Opportunities for Global X and Energisa Mato
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Global and Energisa is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Global X Funds and Energisa Mato Grosso in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energisa Mato Grosso and Global X 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 Global X Funds are associated (or correlated) with Energisa Mato. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energisa Mato Grosso has no effect on the direction of Global X i.e., Global X and Energisa Mato go up and down completely randomly.
Pair Corralation between Global X and Energisa Mato
Assuming the 90 days trading horizon Global X Funds is expected to generate 493.73 times more return on investment than Energisa Mato. However, Global X is 493.73 times more volatile than Energisa Mato Grosso. It trades about 0.16 of its potential returns per unit of risk. Energisa Mato Grosso is currently generating about -0.23 per unit of risk. If you would invest 4,700 in Global X Funds on September 2, 2024 and sell it today you would earn a total of 195.00 from holding Global X Funds or generate 4.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global X Funds vs. Energisa Mato Grosso
Performance |
| Timeline |
| Global X Funds |
| Energisa Mato Grosso |
Global X and Energisa Mato Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Energisa Mato
The main advantage of trading using opposite Global X and Energisa Mato positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Energisa Mato 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 Energisa Mato will offset losses from the drop in Energisa Mato's long position.| Global X vs. Taiwan Semiconductor Manufacturing | Global X vs. Alibaba Group Holding | Global X vs. Microsoft | Global X vs. Alphabet |
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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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