Correlation Between Global X and CI Gold
Can any of the company-specific risk be diversified away by investing in both Global X and CI Gold 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 Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Pipelines and CI Gold Giants, you can compare the effects of market volatilities on Global X and CI Gold 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 Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and CI Gold.
Diversification Opportunities for Global X and CI Gold
Significant diversification
The 3 months correlation between Global and CGXF is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Global X Pipelines and CI Gold Giants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Gold Giants 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 Pipelines are associated (or correlated) with CI Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Gold Giants has no effect on the direction of Global X i.e., Global X and CI Gold go up and down completely randomly.
Pair Corralation between Global X and CI Gold
Assuming the 90 days trading horizon Global X Pipelines is expected to generate 0.58 times more return on investment than CI Gold. However, Global X Pipelines is 1.71 times less risky than CI Gold. It trades about 0.2 of its potential returns per unit of risk. CI Gold Giants is currently generating about -0.13 per unit of risk. If you would invest 1,129 in Global X Pipelines on September 2, 2024 and sell it today you would earn a total of 53.00 from holding Global X Pipelines or generate 4.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Global X Pipelines vs. CI Gold Giants
Performance |
| Timeline |
| Global X Pipelines |
| CI Gold Giants |
Global X and CI Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and CI Gold
The main advantage of trading using opposite Global X and CI Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, CI Gold 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 Gold will offset losses from the drop in CI Gold's long position.| Global X vs. CI Gold Giants | Global X vs. First Asset Tech | Global X vs. CI Canada Lifeco | Global X vs. Harvest Healthcare Leaders |
| CI Gold vs. First Asset Energy | CI Gold vs. First Asset Tech | CI Gold vs. Harvest Equal Weight | CI Gold vs. CI Canada Lifeco |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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