Correlation Between Global X and SPDR Portfolio
Can any of the company-specific risk be diversified away by investing in both Global X and SPDR Portfolio 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 SPDR Portfolio 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 SPDR Portfolio Intermediate, you can compare the effects of market volatilities on Global X and SPDR Portfolio 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 SPDR Portfolio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and SPDR Portfolio.
Diversification Opportunities for Global X and SPDR Portfolio
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Global and SPDR is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Global X Conscious and SPDR Portfolio Intermediate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Portfolio Inter 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 SPDR Portfolio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Portfolio Inter has no effect on the direction of Global X i.e., Global X and SPDR Portfolio go up and down completely randomly.
Pair Corralation between Global X and SPDR Portfolio
Given the investment horizon of 90 days Global X Conscious is expected to generate 2.79 times more return on investment than SPDR Portfolio. However, Global X is 2.79 times more volatile than SPDR Portfolio Intermediate. It trades about 0.1 of its potential returns per unit of risk. SPDR Portfolio Intermediate is currently generating about 0.05 per unit of risk. If you would invest 3,494 in Global X Conscious on August 27, 2024 and sell it today you would earn a total of 531.00 from holding Global X Conscious or generate 15.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global X Conscious vs. SPDR Portfolio Intermediate
Performance |
| Timeline |
| Global X Conscious |
| SPDR Portfolio Inter |
Global X and SPDR Portfolio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and SPDR Portfolio
The main advantage of trading using opposite Global X and SPDR Portfolio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, SPDR Portfolio 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 SPDR Portfolio will offset losses from the drop in SPDR Portfolio's long position.| Global X vs. Morningstar Unconstrained Allocation | Global X vs. High Yield Municipal Fund | Global X vs. Via Renewables | Global X vs. Knife River |
| SPDR Portfolio vs. SPDR Barclays Short | SPDR Portfolio vs. SPDR Barclays Long | SPDR Portfolio vs. SPDR Portfolio Mortgage | SPDR Portfolio vs. SPDR Barclays Intermediate |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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