Correlation Between GLOBAL X and IShares Premium
Can any of the company-specific risk be diversified away by investing in both GLOBAL X and IShares Premium 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 IShares Premium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GLOBAL X HIGH and iShares Premium Money, you can compare the effects of market volatilities on GLOBAL X and IShares Premium 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 IShares Premium. Check out your portfolio center. Please also check ongoing floating volatility patterns of GLOBAL X and IShares Premium.
Diversification Opportunities for GLOBAL X and IShares Premium
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between GLOBAL and IShares is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding GLOBAL X HIGH and iShares Premium Money in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Premium Money 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 HIGH are associated (or correlated) with IShares Premium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Premium Money has no effect on the direction of GLOBAL X i.e., GLOBAL X and IShares Premium go up and down completely randomly.
Pair Corralation between GLOBAL X and IShares Premium
Assuming the 90 days trading horizon GLOBAL X is expected to generate 1.02 times less return on investment than IShares Premium. In addition to that, GLOBAL X is 1.19 times more volatile than iShares Premium Money. It trades about 0.85 of its total potential returns per unit of risk. iShares Premium Money is currently generating about 1.03 per unit of volatility. If you would invest 4,738 in iShares Premium Money on September 26, 2024 and sell it today you would earn a total of 280.00 from holding iShares Premium Money or generate 5.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.68% |
| Values | Daily Returns |
GLOBAL X HIGH vs. iShares Premium Money
Performance |
| Timeline |
| GLOBAL X HIGH |
| iShares Premium Money |
GLOBAL X and IShares Premium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GLOBAL X and IShares Premium
The main advantage of trading using opposite GLOBAL X and IShares Premium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GLOBAL X position performs unexpectedly, IShares Premium 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 IShares Premium will offset losses from the drop in IShares Premium's long position.| GLOBAL X vs. Global X Cash | GLOBAL X vs. iShares Premium Money | GLOBAL X vs. iShares Canadian HYBrid | GLOBAL X vs. Altagas Cum Red |
| IShares Premium vs. iShares 1 5 Year | IShares Premium vs. iShares Global Infrastructure | IShares Premium vs. iShares Global Real | IShares Premium vs. iShares Global Monthly |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |