Correlation Between Global X and Ultimus Managers
Can any of the company-specific risk be diversified away by investing in both Global X and Ultimus Managers 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 Ultimus Managers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X MLP and Ultimus Managers Trust, you can compare the effects of market volatilities on Global X and Ultimus Managers 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 Ultimus Managers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Ultimus Managers.
Diversification Opportunities for Global X and Ultimus Managers
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Global and Ultimus is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Global X MLP and Ultimus Managers Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ultimus Managers 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 MLP are associated (or correlated) with Ultimus Managers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ultimus Managers Trust has no effect on the direction of Global X i.e., Global X and Ultimus Managers go up and down completely randomly.
Pair Corralation between Global X and Ultimus Managers
Given the investment horizon of 90 days Global X MLP is expected to generate 1.17 times more return on investment than Ultimus Managers. However, Global X is 1.17 times more volatile than Ultimus Managers Trust. It trades about 0.23 of its potential returns per unit of risk. Ultimus Managers Trust is currently generating about 0.17 per unit of risk. If you would invest 4,827 in Global X MLP on August 30, 2024 and sell it today you would earn a total of 1,520 from holding Global X MLP or generate 31.49% 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 MLP vs. Ultimus Managers Trust
Performance |
| Timeline |
| Global X MLP |
| Ultimus Managers Trust |
Global X and Ultimus Managers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Ultimus Managers
The main advantage of trading using opposite Global X and Ultimus Managers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Ultimus Managers 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 Ultimus Managers will offset losses from the drop in Ultimus Managers' long position.| Global X vs. Global X MLP | Global X vs. Alerian Energy Infrastructure | Global X vs. First Trust North | Global X vs. Tortoise North American |
| Ultimus Managers vs. Global X MLP | Ultimus Managers vs. InfraCap MLP ETF | Ultimus Managers vs. Barclays ETN Select | Ultimus Managers vs. Alerian Energy Infrastructure |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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