Correlation Between Global X and Tema ETF
Can any of the company-specific risk be diversified away by investing in both Global X and Tema ETF 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 Tema ETF 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 Tema ETF Trust, you can compare the effects of market volatilities on Global X and Tema ETF 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 Tema ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Tema ETF.
Diversification Opportunities for Global X and Tema ETF
Significant diversification
The 3 months correlation between Global and Tema is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Global X Funds and Tema ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tema ETF 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 Tema ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tema ETF Trust has no effect on the direction of Global X i.e., Global X and Tema ETF go up and down completely randomly.
Pair Corralation between Global X and Tema ETF
Considering the 90-day investment horizon Global X is expected to generate 11.54 times less return on investment than Tema ETF. In addition to that, Global X is 1.18 times more volatile than Tema ETF Trust. It trades about 0.04 of its total potential returns per unit of risk. Tema ETF Trust is currently generating about 0.59 per unit of volatility. If you would invest 2,156 in Tema ETF Trust on November 4, 2024 and sell it today you would earn a total of 246.00 from holding Tema ETF Trust or generate 11.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global X Funds vs. Tema ETF Trust
Performance |
| Timeline |
| Global X Funds |
| Tema ETF Trust |
Global X and Tema ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Tema ETF
The main advantage of trading using opposite Global X and Tema ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Tema ETF 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 Tema ETF will offset losses from the drop in Tema ETF'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 |
| Tema ETF vs. Smith Nephew SNATS | Tema ETF vs. Fresenius Medical Care | Tema ETF vs. Fomento Economico Mexicano | Tema ETF vs. The Cooper Companies, |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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