Correlation Between Macquarie ETF and Global X
Can any of the company-specific risk be diversified away by investing in both Macquarie ETF 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 Macquarie ETF and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macquarie ETF Trust and Global X Lithium, you can compare the effects of market volatilities on Macquarie ETF 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 Macquarie ETF with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie ETF and Global X.
Diversification Opportunities for Macquarie ETF and Global X
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Macquarie and Global is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie ETF Trust and Global X Lithium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Lithium and Macquarie ETF 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 Macquarie ETF Trust 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 Lithium has no effect on the direction of Macquarie ETF i.e., Macquarie ETF and Global X go up and down completely randomly.
Pair Corralation between Macquarie ETF and Global X
Given the investment horizon of 90 days Macquarie ETF Trust is expected to generate 0.73 times more return on investment than Global X. However, Macquarie ETF Trust is 1.38 times less risky than Global X. It trades about 0.06 of its potential returns per unit of risk. Global X Lithium is currently generating about -0.04 per unit of risk. If you would invest 2,494 in Macquarie ETF Trust on August 28, 2024 and sell it today you would earn a total of 465.00 from holding Macquarie ETF Trust or generate 18.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 70.9% |
| Values | Daily Returns |
Macquarie ETF Trust vs. Global X Lithium
Performance |
| Timeline |
| Macquarie ETF Trust |
| Global X Lithium |
Macquarie ETF and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macquarie ETF and Global X
The main advantage of trading using opposite Macquarie ETF and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquarie ETF 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.| Macquarie ETF vs. iShares Dividend and | Macquarie ETF vs. Martin Currie Sustainable | Macquarie ETF vs. VictoryShares THB Mid | Macquarie ETF vs. Mast Global Battery |
| Global X vs. Invesco Solar ETF | Global X vs. Albemarle Corp | Global X vs. Lithium Americas Corp | Global X vs. iShares Global Clean |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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