Correlation Between Xtrackers and Global X
Can any of the company-specific risk be diversified away by investing in both Xtrackers 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 Xtrackers and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers II and Global X Cybersecurity, you can compare the effects of market volatilities on Xtrackers 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 Xtrackers with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers and Global X.
Diversification Opportunities for Xtrackers and Global X
Excellent diversification
The 3 months correlation between Xtrackers and Global is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers II and Global X Cybersecurity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Cybersecurity and Xtrackers 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 Xtrackers II 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 Cybersecurity has no effect on the direction of Xtrackers i.e., Xtrackers and Global X go up and down completely randomly.
Pair Corralation between Xtrackers and Global X
Assuming the 90 days trading horizon Xtrackers II is expected to generate 0.88 times more return on investment than Global X. However, Xtrackers II is 1.14 times less risky than Global X. It trades about 0.11 of its potential returns per unit of risk. Global X Cybersecurity is currently generating about 0.06 per unit of risk. If you would invest 753.00 in Xtrackers II on September 14, 2024 and sell it today you would earn a total of 19.00 from holding Xtrackers II or generate 2.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
Xtrackers II vs. Global X Cybersecurity
Performance |
| Timeline |
| Xtrackers II |
| Global X Cybersecurity |
Xtrackers and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers and Global X
The main advantage of trading using opposite Xtrackers and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers 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.| Xtrackers vs. UBS Fund Solutions | Xtrackers vs. Xtrackers Nikkei 225 | Xtrackers vs. iShares VII PLC | Xtrackers vs. SPDR Gold Shares |
| Global X vs. Global X China | Global X vs. Global X Aave | Global X vs. Global X NASDAQ | Global X vs. Global X Cloud |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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