Correlation Between Global X and Listed Funds
Can any of the company-specific risk be diversified away by investing in both Global X and Listed Funds 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 Listed Funds 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 Listed Funds Trust, you can compare the effects of market volatilities on Global X and Listed Funds 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 Listed Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Listed Funds.
Diversification Opportunities for Global X and Listed Funds
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Global and Listed is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Global X Funds and Listed Funds Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Listed Funds Trust 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 Listed Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Listed Funds Trust has no effect on the direction of Global X i.e., Global X and Listed Funds go up and down completely randomly.
Pair Corralation between Global X and Listed Funds
Considering the 90-day investment horizon Global X is expected to generate 2.39 times less return on investment than Listed Funds. In addition to that, Global X is 1.4 times more volatile than Listed Funds Trust. It trades about 0.02 of its total potential returns per unit of risk. Listed Funds Trust is currently generating about 0.07 per unit of volatility. If you would invest 2,750 in Listed Funds Trust on September 3, 2024 and sell it today you would earn a total of 668.00 from holding Listed Funds Trust or generate 24.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 78.99% |
| Values | Daily Returns |
Global X Funds vs. Listed Funds Trust
Performance |
| Timeline |
| Global X Funds |
| Listed Funds Trust |
Global X and Listed Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Listed Funds
The main advantage of trading using opposite Global X and Listed Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Listed Funds 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 Listed Funds will offset losses from the drop in Listed Funds' long position.| Global X vs. SCOR PK | Global X vs. HUMANA INC | Global X vs. Aquagold International | Global X vs. Barloworld Ltd ADR |
| Listed Funds vs. Global X Funds | Listed Funds vs. Dell Technologies | Listed Funds vs. Juniper Networks | Listed Funds vs. HUMANA INC |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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