Correlation Between Global X and Invesco Actively
Can any of the company-specific risk be diversified away by investing in both Global X and Invesco Actively 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 Invesco Actively into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X SP and Invesco Actively Managed, you can compare the effects of market volatilities on Global X and Invesco Actively 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 Invesco Actively. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Invesco Actively.
Diversification Opportunities for Global X and Invesco Actively
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Global and Invesco is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Global X SP and Invesco Actively Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Actively Managed 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 SP are associated (or correlated) with Invesco Actively. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Actively Managed has no effect on the direction of Global X i.e., Global X and Invesco Actively go up and down completely randomly.
Pair Corralation between Global X and Invesco Actively
Given the investment horizon of 90 days Global X is expected to generate 1.74 times less return on investment than Invesco Actively. But when comparing it to its historical volatility, Global X SP is 1.26 times less risky than Invesco Actively. It trades about 0.18 of its potential returns per unit of risk. Invesco Actively Managed is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 4,654 in Invesco Actively Managed on October 25, 2024 and sell it today you would earn a total of 123.10 from holding Invesco Actively Managed or generate 2.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global X SP vs. Invesco Actively Managed
Performance |
| Timeline |
| Global X SP |
| Invesco Actively Managed |
Global X and Invesco Actively Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Invesco Actively
The main advantage of trading using opposite Global X and Invesco Actively positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Invesco Actively 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 Invesco Actively will offset losses from the drop in Invesco Actively's long position.| Global X vs. Global X Russell | Global X vs. Global X NASDAQ | Global X vs. NEOS ETF Trust | Global X vs. JPMorgan Equity Premium |
| Invesco Actively vs. Harbor ETF Trust | Invesco Actively vs. iShares Trust | Invesco Actively vs. Xtrackers MSCI Emerging | Invesco Actively vs. iShares MSCI Emerging |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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