Correlation Between Global X and SPDR Galaxy
Can any of the company-specific risk be diversified away by investing in both Global X and SPDR Galaxy 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 SPDR Galaxy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Funds and SPDR Galaxy Digital, you can compare the effects of market volatilities on Global X and SPDR Galaxy 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 SPDR Galaxy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and SPDR Galaxy.
Diversification Opportunities for Global X and SPDR Galaxy
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Global and SPDR is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Global X Funds and SPDR Galaxy Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Galaxy Digital 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 Funds are associated (or correlated) with SPDR Galaxy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Galaxy Digital has no effect on the direction of Global X i.e., Global X and SPDR Galaxy go up and down completely randomly.
Pair Corralation between Global X and SPDR Galaxy
Given the investment horizon of 90 days Global X Funds is expected to under-perform the SPDR Galaxy. But the etf apears to be less risky and, when comparing its historical volatility, Global X Funds is 3.08 times less risky than SPDR Galaxy. The etf trades about -0.31 of its potential returns per unit of risk. The SPDR Galaxy Digital is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 4,003 in SPDR Galaxy Digital on September 13, 2024 and sell it today you would lose (147.00) from holding SPDR Galaxy Digital or give up 3.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Global X Funds vs. SPDR Galaxy Digital
Performance |
| Timeline |
| Global X Funds |
| SPDR Galaxy Digital |
Global X and SPDR Galaxy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and SPDR Galaxy
The main advantage of trading using opposite Global X and SPDR Galaxy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, SPDR Galaxy 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 SPDR Galaxy will offset losses from the drop in SPDR Galaxy's long position.| Global X vs. Invesco DWA Utilities | Global X vs. Invesco Dynamic Large | Global X vs. SCOR PK | Global X vs. Morningstar Unconstrained Allocation |
| SPDR Galaxy vs. Grayscale Bitcoin Trust | SPDR Galaxy vs. Siren Nasdaq NexGen | SPDR Galaxy vs. First Trust Indxx | SPDR Galaxy vs. Bitwise Crypto Industry |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |