Correlation Between Namibia Critical and Global X
Can any of the company-specific risk be diversified away by investing in both Namibia Critical and Global X 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 Namibia Critical and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Namibia Critical Metals and Global X Active, you can compare the effects of market volatilities on Namibia Critical 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 Namibia Critical with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Namibia Critical and Global X.
Diversification Opportunities for Namibia Critical and Global X
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Namibia and Global is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Namibia Critical Metals and Global X Active in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Active and Namibia Critical 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 Namibia Critical Metals 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 Active has no effect on the direction of Namibia Critical i.e., Namibia Critical and Global X go up and down completely randomly.
Pair Corralation between Namibia Critical and Global X
Assuming the 90 days horizon Namibia Critical Metals is expected to generate 19.12 times more return on investment than Global X. However, Namibia Critical is 19.12 times more volatile than Global X Active. It trades about 0.01 of its potential returns per unit of risk. Global X Active is currently generating about 0.07 per unit of risk. If you would invest 5.00 in Namibia Critical Metals on September 2, 2024 and sell it today you would lose (2.00) from holding Namibia Critical Metals or give up 40.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Namibia Critical Metals vs. Global X Active
Performance |
| Timeline |
| Namibia Critical Metals |
| Global X Active |
Namibia Critical and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Namibia Critical and Global X
The main advantage of trading using opposite Namibia Critical and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Namibia Critical 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.| Namibia Critical vs. Kiplin Metals | Namibia Critical vs. Noram Lithium Corp | Namibia Critical vs. Minnova Corp |
| Global X vs. BMO Covered Call | Global X vs. Forstrong Global Income | Global X vs. BMO Aggregate Bond | Global X vs. iShares Canadian HYBrid |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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