Correlation Between Vanguard High and Global X
Can any of the company-specific risk be diversified away by investing in both Vanguard High 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 Vanguard High and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard High Dividend and Global X SP, you can compare the effects of market volatilities on Vanguard High 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 Vanguard High with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard High and Global X.
Diversification Opportunities for Vanguard High and Global X
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Vanguard and Global is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard High Dividend and Global X SP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X SP and Vanguard High 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 Vanguard High Dividend 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 SP has no effect on the direction of Vanguard High i.e., Vanguard High and Global X go up and down completely randomly.
Pair Corralation between Vanguard High and Global X
Considering the 90-day investment horizon Vanguard High Dividend is expected to generate 1.05 times more return on investment than Global X. However, Vanguard High is 1.05 times more volatile than Global X SP. It trades about 0.16 of its potential returns per unit of risk. Global X SP is currently generating about 0.13 per unit of risk. If you would invest 10,351 in Vanguard High Dividend on August 26, 2024 and sell it today you would earn a total of 3,011 from holding Vanguard High Dividend or generate 29.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard High Dividend vs. Global X SP
Performance |
| Timeline |
| Vanguard High Dividend |
| Global X SP |
Vanguard High and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard High and Global X
The main advantage of trading using opposite Vanguard High and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard High 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.| Vanguard High vs. Vanguard Dividend Appreciation | Vanguard High vs. Schwab Dividend Equity | Vanguard High vs. Vanguard Real Estate | Vanguard High vs. Vanguard Total Stock |
| Global X vs. BlackRock ETF Trust | Global X vs. Rbb Fund | Global X vs. Virtus ETF Trust | Global X vs. Amplify CWP Enhanced |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |