Correlation Between Netflix and Global X
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By analyzing existing cross correlation between Netflix and Global X SP, you can compare the effects of market volatilities on Netflix 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 Netflix with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netflix and Global X.
Diversification Opportunities for Netflix and Global X
Almost no diversification
The 3 months correlation between Netflix and Global is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Netflix and Global X SP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X SP and Netflix 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 Netflix 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 SP has no effect on the direction of Netflix i.e., Netflix and Global X go up and down completely randomly.
Pair Corralation between Netflix and Global X
Given the investment horizon of 90 days Netflix is expected to generate 1.95 times more return on investment than Global X. However, Netflix is 1.95 times more volatile than Global X SP. It trades about 0.57 of its potential returns per unit of risk. Global X SP is currently generating about 0.43 per unit of risk. If you would invest 75,551 in Netflix on September 4, 2024 and sell it today you would earn a total of 14,223 from holding Netflix or generate 18.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Netflix vs. Global X SP
Performance |
| Timeline |
| Netflix |
| Global X SP |
Netflix and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Netflix and Global X
The main advantage of trading using opposite Netflix and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Netflix 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.| Netflix vs. Paramount Global Class | Netflix vs. Roku Inc | Netflix vs. Warner Bros Discovery | Netflix vs. AMC Entertainment Holdings |
| Global X vs. UBS Fund Solutions | Global X vs. Xtrackers II | Global X vs. Xtrackers Nikkei 225 | Global X vs. iShares VII PLC |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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