Correlation Between CHIK and Global X
Can any of the company-specific risk be diversified away by investing in both CHIK 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 CHIK and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CHIK and Global X MSCI, you can compare the effects of market volatilities on CHIK 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 CHIK with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHIK and Global X.
Diversification Opportunities for CHIK and Global X
Excellent diversification
The 3 months correlation between CHIK and Global is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding CHIK and Global X MSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X MSCI and CHIK 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 CHIK 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 MSCI has no effect on the direction of CHIK i.e., CHIK and Global X go up and down completely randomly.
Pair Corralation between CHIK and Global X
Given the investment horizon of 90 days CHIK is expected to under-perform the Global X. In addition to that, CHIK is 1.7 times more volatile than Global X MSCI. It trades about -0.13 of its total potential returns per unit of risk. Global X MSCI is currently generating about 0.02 per unit of volatility. If you would invest 1,767 in Global X MSCI on August 31, 2024 and sell it today you would earn a total of 178.00 from holding Global X MSCI or generate 10.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 8.56% |
| Values | Daily Returns |
CHIK vs. Global X MSCI
Performance |
| Timeline |
| CHIK |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Global X MSCI |
CHIK and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CHIK and Global X
The main advantage of trading using opposite CHIK and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHIK 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.| CHIK vs. Xtrackers Harvest CSI | CHIK vs. Aquagold International | CHIK vs. Thrivent High Yield | CHIK vs. Morningstar Unconstrained Allocation |
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 Stocks Directory module to find actively traded stocks across global markets.
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