Correlation Between Global X and Harbor ETF
Can any of the company-specific risk be diversified away by investing in both Global X and Harbor ETF 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 Harbor ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Conscious and Harbor ETF Trust, you can compare the effects of market volatilities on Global X and Harbor ETF 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 Harbor ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Harbor ETF.
Diversification Opportunities for Global X and Harbor ETF
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Global and Harbor is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Global X Conscious and Harbor ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbor ETF 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 Conscious are associated (or correlated) with Harbor ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbor ETF Trust has no effect on the direction of Global X i.e., Global X and Harbor ETF go up and down completely randomly.
Pair Corralation between Global X and Harbor ETF
Given the investment horizon of 90 days Global X Conscious is expected to generate 1.76 times more return on investment than Harbor ETF. However, Global X is 1.76 times more volatile than Harbor ETF Trust. It trades about 0.14 of its potential returns per unit of risk. Harbor ETF Trust is currently generating about 0.09 per unit of risk. If you would invest 3,932 in Global X Conscious on August 30, 2024 and sell it today you would earn a total of 111.00 from holding Global X Conscious or generate 2.82% 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 Conscious vs. Harbor ETF Trust
Performance |
| Timeline |
| Global X Conscious |
| Harbor ETF Trust |
Global X and Harbor ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Harbor ETF
The main advantage of trading using opposite Global X and Harbor ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Harbor ETF 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 Harbor ETF will offset losses from the drop in Harbor ETF's long position.| Global X vs. Global X SP | Global X vs. Global X MSCI | Global X vs. Global X Alternative | Global X vs. Janus Henderson SmallMid |
| Harbor ETF vs. iShares Core Aggressive | Harbor ETF vs. SPDR SSgA Multi Asset | Harbor ETF vs. SPDR SSgA Global | Harbor ETF vs. Investment Managers Series |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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