Correlation Between Innovator and Global X
Can any of the company-specific risk be diversified away by investing in both Innovator 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 Innovator and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innovator SP Investment and Global X SuperIncome, you can compare the effects of market volatilities on Innovator 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 Innovator with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovator and Global X.
Diversification Opportunities for Innovator and Global X
Very poor diversification
The 3 months correlation between Innovator and Global is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Innovator SP Investment and Global X SuperIncome in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X SuperIncome and Innovator 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 Innovator SP Investment 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 SuperIncome has no effect on the direction of Innovator i.e., Innovator and Global X go up and down completely randomly.
Pair Corralation between Innovator and Global X
Given the investment horizon of 90 days Innovator SP Investment is expected to generate 1.19 times more return on investment than Global X. However, Innovator is 1.19 times more volatile than Global X SuperIncome. It trades about 0.06 of its potential returns per unit of risk. Global X SuperIncome is currently generating about 0.05 per unit of risk. If you would invest 1,853 in Innovator SP Investment on November 3, 2024 and sell it today you would earn a total of 23.00 from holding Innovator SP Investment or generate 1.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Innovator SP Investment vs. Global X SuperIncome
Performance |
| Timeline |
| Innovator SP Investment |
| Global X SuperIncome |
Innovator and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovator and Global X
The main advantage of trading using opposite Innovator and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovator 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.| Innovator vs. ETFis Series Trust | Innovator vs. Global X Preferred | Innovator vs. VanEck Preferred Securities | Innovator vs. Global X SuperIncome |
| Global X vs. Freedom Day Dividend | Global X vs. iShares MSCI China | Global X vs. SmartETFs Dividend Builder | Global X vs. Listed Funds Trust |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |