Correlation Between Global X and Guardian International
Can any of the company-specific risk be diversified away by investing in both Global X and Guardian International 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 Guardian International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Big and Guardian International Equity, you can compare the effects of market volatilities on Global X and Guardian International 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 Guardian International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Guardian International.
Diversification Opportunities for Global X and Guardian International
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Global and Guardian is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Global X Big and Guardian International Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guardian International 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 Big are associated (or correlated) with Guardian International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guardian International has no effect on the direction of Global X i.e., Global X and Guardian International go up and down completely randomly.
Pair Corralation between Global X and Guardian International
Assuming the 90 days trading horizon Global X Big is expected to generate 3.73 times more return on investment than Guardian International. However, Global X is 3.73 times more volatile than Guardian International Equity. It trades about 0.07 of its potential returns per unit of risk. Guardian International Equity is currently generating about 0.05 per unit of risk. If you would invest 1,897 in Global X Big on September 12, 2024 and sell it today you would earn a total of 1,384 from holding Global X Big or generate 72.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 72.85% |
| Values | Daily Returns |
Global X Big vs. Guardian International Equity
Performance |
| Timeline |
| Global X Big |
| Guardian International |
Global X and Guardian International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Guardian International
The main advantage of trading using opposite Global X and Guardian International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Guardian International 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 Guardian International will offset losses from the drop in Guardian International's long position.| Global X vs. iShares SPTSX 60 | Global X vs. iShares Core SP | Global X vs. iShares Core SPTSX | Global X vs. BMO Aggregate Bond |
| Guardian International vs. iShares Core MSCI | Guardian International vs. BMO MSCI EAFE | Guardian International vs. Vanguard FTSE Developed | Guardian International vs. iShares MSCI EAFE |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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