Correlation Between Global X and Osisko Metals
Can any of the company-specific risk be diversified away by investing in both Global X and Osisko 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 Osisko 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 Osisko Metals, you can compare the effects of market volatilities on Global X and Osisko 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 Osisko Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Osisko Metals.
Diversification Opportunities for Global X and Osisko Metals
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Global and Osisko is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Global X Active and Osisko Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Osisko Metals 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 Osisko Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Osisko Metals has no effect on the direction of Global X i.e., Global X and Osisko Metals go up and down completely randomly.
Pair Corralation between Global X and Osisko Metals
Assuming the 90 days trading horizon Global X is expected to generate 3.38 times less return on investment than Osisko Metals. But when comparing it to its historical volatility, Global X Active is 8.72 times less risky than Osisko Metals. It trades about 0.14 of its potential returns per unit of risk. Osisko Metals is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 17.00 in Osisko Metals on September 2, 2024 and sell it today you would earn a total of 8.00 from holding Osisko Metals or generate 47.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Global X Active vs. Osisko Metals
Performance |
| Timeline |
| Global X Active |
| Osisko Metals |
Global X and Osisko Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Osisko Metals
The main advantage of trading using opposite Global X and Osisko Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Osisko 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 Osisko Metals will offset losses from the drop in Osisko 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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