Correlation Between Global X and ProShares MSCI
Can any of the company-specific risk be diversified away by investing in both Global X and ProShares MSCI 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 ProShares MSCI 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 ProShares MSCI Emerging, you can compare the effects of market volatilities on Global X and ProShares MSCI 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 ProShares MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and ProShares MSCI.
Diversification Opportunities for Global X and ProShares MSCI
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Global and ProShares is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Global X Funds and ProShares MSCI Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares MSCI Emerging 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 ProShares MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares MSCI Emerging has no effect on the direction of Global X i.e., Global X and ProShares MSCI go up and down completely randomly.
Pair Corralation between Global X and ProShares MSCI
Considering the 90-day investment horizon Global X Funds is expected to generate 1.25 times more return on investment than ProShares MSCI. However, Global X is 1.25 times more volatile than ProShares MSCI Emerging. It trades about 0.01 of its potential returns per unit of risk. ProShares MSCI Emerging is currently generating about -0.06 per unit of risk. If you would invest 2,669 in Global X Funds on November 4, 2024 and sell it today you would earn a total of 0.00 from holding Global X Funds or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global X Funds vs. ProShares MSCI Emerging
Performance |
| Timeline |
| Global X Funds |
| ProShares MSCI Emerging |
Global X and ProShares MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and ProShares MSCI
The main advantage of trading using opposite Global X and ProShares MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, ProShares MSCI 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 ProShares MSCI will offset losses from the drop in ProShares MSCI's long position.| Global X vs. iShares Dividend and | Global X vs. Martin Currie Sustainable | Global X vs. VictoryShares THB Mid | Global X vs. Mast Global Battery |
| ProShares MSCI vs. ProShares MSCI EAFE | ProShares MSCI vs. ProShares MSCI Europe | ProShares MSCI vs. ProShares Russell 2000 | ProShares MSCI vs. ProShares SP MidCap |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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