Correlation Between Global X and Matthews International
Can any of the company-specific risk be diversified away by investing in both Global X and Matthews International 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 Matthews International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Funds and Matthews International Funds, you can compare the effects of market volatilities on Global X and Matthews International 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 Matthews International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Matthews International.
Diversification Opportunities for Global X and Matthews International
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Global and Matthews is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Global X Funds and Matthews International Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matthews International 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 Funds are associated (or correlated) with Matthews International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matthews International has no effect on the direction of Global X i.e., Global X and Matthews International go up and down completely randomly.
Pair Corralation between Global X and Matthews International
Given the investment horizon of 90 days Global X Funds is expected to generate 0.78 times more return on investment than Matthews International. However, Global X Funds is 1.28 times less risky than Matthews International. It trades about 0.08 of its potential returns per unit of risk. Matthews International Funds is currently generating about 0.02 per unit of risk. If you would invest 2,494 in Global X Funds on September 1, 2024 and sell it today you would earn a total of 598.00 from holding Global X Funds or generate 23.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 92.62% |
| Values | Daily Returns |
Global X Funds vs. Matthews International Funds
Performance |
| Timeline |
| Global X Funds |
| Matthews International |
Global X and Matthews International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Matthews International
The main advantage of trading using opposite Global X and Matthews International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Matthews International 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 Matthews International will offset losses from the drop in Matthews International's long position.| Global X vs. iShares MSCI India | Global X vs. iShares India 50 | Global X vs. Invesco India ETF | Global X vs. Franklin FTSE India |
| Matthews International vs. iShares MSCI Emerging | Matthews International vs. Global X Funds | Matthews International vs. Franklin FTSE Asia | Matthews International vs. Franklin FTSE Europe |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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