Correlation Between Global X and CI MidCap
Can any of the company-specific risk be diversified away by investing in both Global X and CI MidCap 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 CI MidCap 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 CI MidCap Dividend, you can compare the effects of market volatilities on Global X and CI MidCap 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 CI MidCap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and CI MidCap.
Diversification Opportunities for Global X and CI MidCap
Poor diversification
The 3 months correlation between Global and UMI is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Global X Big and CI MidCap Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI MidCap Dividend 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 CI MidCap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI MidCap Dividend has no effect on the direction of Global X i.e., Global X and CI MidCap go up and down completely randomly.
Pair Corralation between Global X and CI MidCap
Assuming the 90 days trading horizon Global X Big is expected to generate 3.13 times more return on investment than CI MidCap. However, Global X is 3.13 times more volatile than CI MidCap Dividend. It trades about 0.1 of its potential returns per unit of risk. CI MidCap Dividend is currently generating about 0.13 per unit of risk. If you would invest 3,202 in Global X Big on October 26, 2024 and sell it today you would earn a total of 175.00 from holding Global X Big or generate 5.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global X Big vs. CI MidCap Dividend
Performance |
| Timeline |
| Global X Big |
| CI MidCap Dividend |
Global X and CI MidCap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and CI MidCap
The main advantage of trading using opposite Global X and CI MidCap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, CI MidCap 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 CI MidCap will offset losses from the drop in CI MidCap's long position.| Global X vs. Blockchain Technologies ETF | Global X vs. Global X Robotics | Global X vs. Evolve Automobile Innovation | Global X vs. Evolve Innovation Index |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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