Correlation Between Global X and Fidelity Value
Can any of the company-specific risk be diversified away by investing in both Global X and Fidelity Value 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 Fidelity Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X SP and Fidelity Value ETF, you can compare the effects of market volatilities on Global X and Fidelity Value 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 Fidelity Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Fidelity Value.
Diversification Opportunities for Global X and Fidelity Value
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Global and Fidelity is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Global X SP and Fidelity Value ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Value ETF 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 SP are associated (or correlated) with Fidelity Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Value ETF has no effect on the direction of Global X i.e., Global X and Fidelity Value go up and down completely randomly.
Pair Corralation between Global X and Fidelity Value
Assuming the 90 days trading horizon Global X SP is expected to generate 0.82 times more return on investment than Fidelity Value. However, Global X SP is 1.23 times less risky than Fidelity Value. It trades about 0.16 of its potential returns per unit of risk. Fidelity Value ETF is currently generating about 0.12 per unit of risk. If you would invest 7,328 in Global X SP on August 29, 2024 and sell it today you would earn a total of 1,287 from holding Global X SP or generate 17.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global X SP vs. Fidelity Value ETF
Performance |
| Timeline |
| Global X SP |
| Fidelity Value ETF |
Global X and Fidelity Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Fidelity Value
The main advantage of trading using opposite Global X and Fidelity Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Fidelity Value 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 Fidelity Value will offset losses from the drop in Fidelity Value's long position.| Global X vs. Global X SPTSX | Global X vs. Vanguard FTSE Developed | Global X vs. Global X Active | Global X vs. iShares SPTSX Capped |
| Fidelity Value vs. Fidelity Canadian Value | Fidelity Value vs. Fidelity High Quality | Fidelity Value vs. Fidelity International Value | Fidelity Value vs. Fidelity Canadian High |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |