Correlation Between Blockchain Technologies and Global X
Can any of the company-specific risk be diversified away by investing in both Blockchain Technologies 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 Blockchain Technologies and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blockchain Technologies ETF and Global X SPTSX, you can compare the effects of market volatilities on Blockchain Technologies 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 Blockchain Technologies with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blockchain Technologies and Global X.
Diversification Opportunities for Blockchain Technologies and Global X
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Blockchain and Global is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Blockchain Technologies ETF and Global X SPTSX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X SPTSX and Blockchain Technologies 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 Blockchain Technologies ETF 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 SPTSX has no effect on the direction of Blockchain Technologies i.e., Blockchain Technologies and Global X go up and down completely randomly.
Pair Corralation between Blockchain Technologies and Global X
Assuming the 90 days trading horizon Blockchain Technologies ETF is expected to generate 7.48 times more return on investment than Global X. However, Blockchain Technologies is 7.48 times more volatile than Global X SPTSX. It trades about 0.31 of its potential returns per unit of risk. Global X SPTSX is currently generating about 0.49 per unit of risk. If you would invest 1,620 in Blockchain Technologies ETF on September 3, 2024 and sell it today you would earn a total of 497.00 from holding Blockchain Technologies ETF or generate 30.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blockchain Technologies ETF vs. Global X SPTSX
Performance |
| Timeline |
| Blockchain Technologies |
| Global X SPTSX |
Blockchain Technologies and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blockchain Technologies and Global X
The main advantage of trading using opposite Blockchain Technologies and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blockchain Technologies 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.| Blockchain Technologies vs. International Zeolite Corp | Blockchain Technologies vs. European Residential Real | Blockchain Technologies vs. Financial 15 Split | Blockchain Technologies vs. Rubicon Organics |
| Global X vs. Global X SPTSX | Global X vs. Global X Canadian | Global X vs. Global X Equal | Global X vs. Global X Europe |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |