Correlation Between Global X and Silver Bullion
Can any of the company-specific risk be diversified away by investing in both Global X and Silver Bullion 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 Silver Bullion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Silver and Silver Bullion Trust, you can compare the effects of market volatilities on Global X and Silver Bullion 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 Silver Bullion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Silver Bullion.
Diversification Opportunities for Global X and Silver Bullion
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Global and Silver is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Global X Silver and Silver Bullion Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silver Bullion Trust 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 Silver are associated (or correlated) with Silver Bullion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silver Bullion Trust has no effect on the direction of Global X i.e., Global X and Silver Bullion go up and down completely randomly.
Pair Corralation between Global X and Silver Bullion
Assuming the 90 days trading horizon Global X Silver is expected to generate 0.96 times more return on investment than Silver Bullion. However, Global X Silver is 1.04 times less risky than Silver Bullion. It trades about 0.17 of its potential returns per unit of risk. Silver Bullion Trust is currently generating about 0.06 per unit of risk. If you would invest 1,362 in Global X Silver on September 12, 2024 and sell it today you would earn a total of 74.00 from holding Global X Silver or generate 5.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Global X Silver vs. Silver Bullion Trust
Performance |
| Timeline |
| Global X Silver |
| Silver Bullion Trust |
Global X and Silver Bullion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Silver Bullion
The main advantage of trading using opposite Global X and Silver Bullion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Silver Bullion 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 Silver Bullion will offset losses from the drop in Silver Bullion's long position.| Global X vs. Global X Gold | Global X vs. Global X Natural | Global X vs. iShares Silver Bullion | Global X vs. BetaPro Silver 2x |
| Silver Bullion vs. Purpose Gold Bullion | Silver Bullion vs. iShares Silver Bullion | Silver Bullion vs. Purpose Diversified Real | Silver Bullion vs. Purpose Premium Yield |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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