Correlation Between ISharesUBS Treasury and Global X
Can any of the company-specific risk be diversified away by investing in both ISharesUBS Treasury and Global X 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 ISharesUBS Treasury and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iSharesUBS Treasury and Global X Hydrogen, you can compare the effects of market volatilities on ISharesUBS Treasury and Global X 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 ISharesUBS Treasury with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of ISharesUBS Treasury and Global X.
Diversification Opportunities for ISharesUBS Treasury and Global X
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between ISharesUBS and Global is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding iSharesUBS Treasury and Global X Hydrogen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Hydrogen and ISharesUBS Treasury 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 iSharesUBS Treasury are associated (or correlated) with Global X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global X Hydrogen has no effect on the direction of ISharesUBS Treasury i.e., ISharesUBS Treasury and Global X go up and down completely randomly.
Pair Corralation between ISharesUBS Treasury and Global X
Assuming the 90 days trading horizon ISharesUBS Treasury is expected to generate 25.23 times less return on investment than Global X. But when comparing it to its historical volatility, iSharesUBS Treasury is 13.57 times less risky than Global X. It trades about 0.1 of its potential returns per unit of risk. Global X Hydrogen is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 436.00 in Global X Hydrogen on August 30, 2024 and sell it today you would earn a total of 56.00 from holding Global X Hydrogen or generate 12.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iSharesUBS Treasury vs. Global X Hydrogen
Performance |
| Timeline |
| iSharesUBS Treasury |
| Global X Hydrogen |
ISharesUBS Treasury and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ISharesUBS Treasury and Global X
The main advantage of trading using opposite ISharesUBS Treasury and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ISharesUBS Treasury position performs unexpectedly, Global X 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 Global X will offset losses from the drop in Global X's long position.| ISharesUBS Treasury vs. iShares MSCI Emerging | ISharesUBS Treasury vs. Global X Hydrogen | ISharesUBS Treasury vs. Janus Henderson Sustainable | ISharesUBS Treasury vs. JPMorgan Equity Premium |
| Global X vs. BetaShares Geared Australian | Global X vs. BetaShares Global Robotics | Global X vs. iShares China LargeCap | Global X vs. Russell Australian Government |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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