Correlation Between Main International and Global X
Can any of the company-specific risk be diversified away by investing in both Main International 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 Main International and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Main International ETF and Global X Funds, you can compare the effects of market volatilities on Main International 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 Main International with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Main International and Global X.
Diversification Opportunities for Main International and Global X
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Main and Global is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Main International ETF and Global X Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Funds and Main International 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 Main International ETF 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 Funds has no effect on the direction of Main International i.e., Main International and Global X go up and down completely randomly.
Pair Corralation between Main International and Global X
Given the investment horizon of 90 days Main International ETF is expected to generate 0.92 times more return on investment than Global X. However, Main International ETF is 1.08 times less risky than Global X. It trades about 0.04 of its potential returns per unit of risk. Global X Funds is currently generating about 0.02 per unit of risk. If you would invest 1,979 in Main International ETF on October 25, 2024 and sell it today you would earn a total of 299.00 from holding Main International ETF or generate 15.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 86.21% |
| Values | Daily Returns |
Main International ETF vs. Global X Funds
Performance |
| Timeline |
| Main International ETF |
| Global X Funds |
Main International and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Main International and Global X
The main advantage of trading using opposite Main International and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Main International 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.| Main International vs. ADTRAN Inc | Main International vs. International Business Machines | Main International vs. Integrated Ventures | Main International vs. Harmonic |
| Global X vs. Freedom Day Dividend | Global X vs. Franklin Templeton ETF | Global X vs. iShares MSCI China | Global X vs. Tidal Trust II |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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