Correlation Between Global X and SHP ETF
Can any of the company-specific risk be diversified away by investing in both Global X and SHP ETF 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 SHP ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Russell and SHP ETF Trust, you can compare the effects of market volatilities on Global X and SHP ETF 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 SHP ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and SHP ETF.
Diversification Opportunities for Global X and SHP ETF
Almost no diversification
The 3 months correlation between Global and SHP is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Global X Russell and SHP ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SHP ETF 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 Russell are associated (or correlated) with SHP ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SHP ETF Trust has no effect on the direction of Global X i.e., Global X and SHP ETF go up and down completely randomly.
Pair Corralation between Global X and SHP ETF
Given the investment horizon of 90 days Global X is expected to generate 1.31 times less return on investment than SHP ETF. In addition to that, Global X is 1.15 times more volatile than SHP ETF Trust. It trades about 0.09 of its total potential returns per unit of risk. SHP ETF Trust is currently generating about 0.14 per unit of volatility. If you would invest 4,664 in SHP ETF Trust on August 29, 2024 and sell it today you would earn a total of 551.00 from holding SHP ETF Trust or generate 11.81% 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 Russell vs. SHP ETF Trust
Performance |
| Timeline |
| Global X Russell |
| SHP ETF Trust |
Global X and SHP ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and SHP ETF
The main advantage of trading using opposite Global X and SHP ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, SHP ETF 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 SHP ETF will offset losses from the drop in SHP ETF's long position.| Global X vs. Global X SP | Global X vs. Global X NASDAQ | Global X vs. NEOS ETF Trust | Global X vs. JPMorgan Equity Premium |
| SHP ETF vs. Global X SP | SHP ETF vs. Amplify CWP Enhanced | SHP ETF vs. Global X Russell | SHP ETF vs. JPMorgan Nasdaq Equity |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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