Correlation Between Global X and Forsys Metals
Can any of the company-specific risk be diversified away by investing in both Global X and Forsys Metals 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 Forsys Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Active and Forsys Metals Corp, you can compare the effects of market volatilities on Global X and Forsys Metals 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 Forsys Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Forsys Metals.
Diversification Opportunities for Global X and Forsys Metals
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Global and Forsys is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Global X Active and Forsys Metals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Forsys Metals Corp 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 Active are associated (or correlated) with Forsys Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Forsys Metals Corp has no effect on the direction of Global X i.e., Global X and Forsys Metals go up and down completely randomly.
Pair Corralation between Global X and Forsys Metals
Assuming the 90 days trading horizon Global X is expected to generate 5.16 times less return on investment than Forsys Metals. But when comparing it to its historical volatility, Global X Active is 8.2 times less risky than Forsys Metals. It trades about 0.06 of its potential returns per unit of risk. Forsys Metals Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 49.00 in Forsys Metals Corp on September 2, 2024 and sell it today you would earn a total of 21.00 from holding Forsys Metals Corp or generate 42.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Global X Active vs. Forsys Metals Corp
Performance |
| Timeline |
| Global X Active |
| Forsys Metals Corp |
Global X and Forsys Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Forsys Metals
The main advantage of trading using opposite Global X and Forsys Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Forsys Metals 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 Forsys Metals will offset losses from the drop in Forsys Metals' long position.| Global X vs. BMO Covered Call | Global X vs. Forstrong Global Income | Global X vs. BMO Aggregate Bond | Global X vs. iShares Canadian HYBrid |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |