Correlation Between Global X and Pacer Export
Can any of the company-specific risk be diversified away by investing in both Global X and Pacer Export 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 Pacer Export into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Cybersecurity and Pacer Export Leaders, you can compare the effects of market volatilities on Global X and Pacer Export 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 Pacer Export. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Pacer Export.
Diversification Opportunities for Global X and Pacer Export
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Global and Pacer is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Global X Cybersecurity and Pacer Export Leaders in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pacer Export Leaders 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 Cybersecurity are associated (or correlated) with Pacer Export. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pacer Export Leaders has no effect on the direction of Global X i.e., Global X and Pacer Export go up and down completely randomly.
Pair Corralation between Global X and Pacer Export
Considering the 90-day investment horizon Global X Cybersecurity is expected to generate 1.38 times more return on investment than Pacer Export. However, Global X is 1.38 times more volatile than Pacer Export Leaders. It trades about 0.07 of its potential returns per unit of risk. Pacer Export Leaders is currently generating about 0.06 per unit of risk. If you would invest 2,371 in Global X Cybersecurity on September 1, 2024 and sell it today you would earn a total of 981.00 from holding Global X Cybersecurity or generate 41.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
Global X Cybersecurity vs. Pacer Export Leaders
Performance |
| Timeline |
| Global X Cybersecurity |
| Pacer Export Leaders |
Global X and Pacer Export Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Pacer Export
The main advantage of trading using opposite Global X and Pacer Export positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Pacer Export 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 Pacer Export will offset losses from the drop in Pacer Export's long position.| Global X vs. Nexalin Technology | Global X vs. Kilroy Realty Corp | Global X vs. Highwoods Properties | Global X vs. Karat Packaging |
| Pacer Export vs. ProShares SP 500 | Pacer Export vs. ProShares SP 500 | Pacer Export vs. ProShares SP 500 | Pacer Export vs. DBX ETF Trust |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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