Correlation Between Global X and Hamilton Canadian
Can any of the company-specific risk be diversified away by investing in both Global X and Hamilton Canadian 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 Hamilton Canadian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Seasonal and Hamilton Canadian Bank, you can compare the effects of market volatilities on Global X and Hamilton Canadian 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 Hamilton Canadian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Hamilton Canadian.
Diversification Opportunities for Global X and Hamilton Canadian
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Global and Hamilton is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Global X Seasonal and Hamilton Canadian Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamilton Canadian Bank 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 Seasonal are associated (or correlated) with Hamilton Canadian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamilton Canadian Bank has no effect on the direction of Global X i.e., Global X and Hamilton Canadian go up and down completely randomly.
Pair Corralation between Global X and Hamilton Canadian
Assuming the 90 days trading horizon Global X is expected to generate 1.71 times less return on investment than Hamilton Canadian. In addition to that, Global X is 1.75 times more volatile than Hamilton Canadian Bank. It trades about 0.12 of its total potential returns per unit of risk. Hamilton Canadian Bank is currently generating about 0.37 per unit of volatility. If you would invest 2,316 in Hamilton Canadian Bank on August 28, 2024 and sell it today you would earn a total of 95.00 from holding Hamilton Canadian Bank or generate 4.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global X Seasonal vs. Hamilton Canadian Bank
Performance |
| Timeline |
| Global X Seasonal |
| Hamilton Canadian Bank |
Global X and Hamilton Canadian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Hamilton Canadian
The main advantage of trading using opposite Global X and Hamilton Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Hamilton Canadian 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 Hamilton Canadian will offset losses from the drop in Hamilton Canadian's long position.| Global X vs. Global X Active | Global X vs. Global X Active | Global X vs. Global X Active | Global X vs. Global X Active |
| Hamilton Canadian vs. Brompton Global Dividend | Hamilton Canadian vs. Tech Leaders Income | Hamilton Canadian vs. Global Healthcare Income | Hamilton Canadian vs. Brompton European Dividend |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |