Correlation Between GLOBAL X and CI High
Can any of the company-specific risk be diversified away by investing in both GLOBAL X and CI High 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 CI High 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 CI High Interest, you can compare the effects of market volatilities on GLOBAL X and CI High 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 CI High. Check out your portfolio center. Please also check ongoing floating volatility patterns of GLOBAL X and CI High.
Diversification Opportunities for GLOBAL X and CI High
Good diversification
The 3 months correlation between GLOBAL and CSAV is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding GLOBAL X HIGH and CI High Interest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI High Interest 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 CI High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI High Interest has no effect on the direction of GLOBAL X i.e., GLOBAL X and CI High go up and down completely randomly.
Pair Corralation between GLOBAL X and CI High
Assuming the 90 days trading horizon GLOBAL X HIGH is expected to generate 0.49 times more return on investment than CI High. However, GLOBAL X HIGH is 2.03 times less risky than CI High. It trades about 0.87 of its potential returns per unit of risk. CI High Interest is currently generating about 0.33 per unit of risk. If you would invest 4,711 in GLOBAL X HIGH on September 12, 2024 and sell it today you would earn a total of 293.00 from holding GLOBAL X HIGH or generate 6.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GLOBAL X HIGH vs. CI High Interest
Performance |
| Timeline |
| GLOBAL X HIGH |
| CI High Interest |
GLOBAL X and CI High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GLOBAL X and CI High
The main advantage of trading using opposite GLOBAL X and CI High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GLOBAL X position performs unexpectedly, CI High 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 CI High will offset losses from the drop in CI High's long position.| GLOBAL X vs. Purpose High Interest | GLOBAL X vs. CI High Interest | GLOBAL X vs. Global X Cash | GLOBAL X vs. iShares Core Equity |
| CI High vs. Purpose High Interest | CI High vs. GLOBAL X HIGH | CI High vs. Global X Cash | CI High vs. iShares Premium Money |
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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