Correlation Between TSJA and Global X
Can any of the company-specific risk be diversified away by investing in both TSJA 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 TSJA and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TSJA and Global X Funds, you can compare the effects of market volatilities on TSJA 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 TSJA with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of TSJA and Global X.
Diversification Opportunities for TSJA and Global X
Almost no diversification
The 3 months correlation between TSJA and Global is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding TSJA and Global X Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Funds and TSJA 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 TSJA 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 Funds has no effect on the direction of TSJA i.e., TSJA and Global X go up and down completely randomly.
Pair Corralation between TSJA and Global X
If you would invest 10,005 in Global X Funds on September 1, 2024 and sell it today you would earn a total of 41.00 from holding Global X Funds or generate 0.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 4.55% |
| Values | Daily Returns |
TSJA vs. Global X Funds
Performance |
| Timeline |
| TSJA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Global X Funds |
TSJA and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TSJA and Global X
The main advantage of trading using opposite TSJA and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TSJA 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.The idea behind TSJA and Global X Funds pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Global X vs. iShares Interest Rate | Global X vs. iShares Interest Rate | Global X vs. iShares Edge Investment | Global X vs. iShares Inflation Hedged |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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