Correlation Between G2D Investments and Global X
Can any of the company-specific risk be diversified away by investing in both G2D Investments 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 G2D Investments and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between G2D Investments and Global X Funds, you can compare the effects of market volatilities on G2D Investments 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 G2D Investments with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of G2D Investments and Global X.
Diversification Opportunities for G2D Investments and Global X
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between G2D and Global is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding G2D Investments and Global X Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Funds and G2D Investments 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 G2D Investments 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 Funds has no effect on the direction of G2D Investments i.e., G2D Investments and Global X go up and down completely randomly.
Pair Corralation between G2D Investments and Global X
Assuming the 90 days trading horizon G2D Investments is expected to generate 1.89 times less return on investment than Global X. In addition to that, G2D Investments is 2.17 times more volatile than Global X Funds. It trades about 0.02 of its total potential returns per unit of risk. Global X Funds is currently generating about 0.08 per unit of volatility. If you would invest 3,467 in Global X Funds on August 28, 2024 and sell it today you would earn a total of 1,413 from holding Global X Funds or generate 40.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.15% |
| Values | Daily Returns |
G2D Investments vs. Global X Funds
Performance |
| Timeline |
| G2D Investments |
| Global X Funds |
G2D Investments and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with G2D Investments and Global X
The main advantage of trading using opposite G2D Investments and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G2D Investments 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.| G2D Investments vs. Zoom Video Communications | G2D Investments vs. Verizon Communications | G2D Investments vs. Southwest Airlines Co | G2D Investments vs. Bemobi Mobile Tech |
| Global X vs. Taiwan Semiconductor Manufacturing | Global X vs. Fras le SA | Global X vs. Clave Indices De | Global X vs. BTG Pactual Logstica |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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