Correlation Between Global X and IShares Global
Can any of the company-specific risk be diversified away by investing in both Global X and IShares Global 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 IShares Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Semiconductor and iShares Global Aggregate, you can compare the effects of market volatilities on Global X and IShares Global 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 IShares Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and IShares Global.
Diversification Opportunities for Global X and IShares Global
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Global and IShares is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Global X Semiconductor and iShares Global Aggregate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Global Aggregate 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 Semiconductor are associated (or correlated) with IShares Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Global Aggregate has no effect on the direction of Global X i.e., Global X and IShares Global go up and down completely randomly.
Pair Corralation between Global X and IShares Global
Assuming the 90 days trading horizon Global X Semiconductor is expected to under-perform the IShares Global. In addition to that, Global X is 10.59 times more volatile than iShares Global Aggregate. It trades about 0.0 of its total potential returns per unit of risk. iShares Global Aggregate is currently generating about 0.13 per unit of volatility. If you would invest 9,358 in iShares Global Aggregate on September 1, 2024 and sell it today you would earn a total of 377.00 from holding iShares Global Aggregate or generate 4.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.23% |
| Values | Daily Returns |
Global X Semiconductor vs. iShares Global Aggregate
Performance |
| Timeline |
| Global X Semiconductor |
| iShares Global Aggregate |
Global X and IShares Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and IShares Global
The main advantage of trading using opposite Global X and IShares Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, IShares Global 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 IShares Global will offset losses from the drop in IShares Global's long position.| Global X vs. Champion Iron | Global X vs. Australian Dairy Farms | Global X vs. Perpetual Credit Income | Global X vs. Greentech Metals |
| IShares Global vs. iShares MSCI Emerging | IShares Global vs. iShares CoreSP MidCap | IShares Global vs. iShares SP 500 | IShares Global vs. iShares Core MSCI |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |