Correlation Between Harbor ETF and Global X

Can any of the company-specific risk be diversified away by investing in both Harbor ETF 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 Harbor ETF and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Harbor ETF Trust and Global X MLP, you can compare the effects of market volatilities on Harbor ETF 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 Harbor ETF with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harbor ETF and Global X.

Diversification Opportunities for Harbor ETF and Global X

0.25

Correlation Coefficient

Harbor ETF  Global X

Modest diversification

The 3 months correlation between Harbor and Global is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Harbor ETF Trust and Global X MLP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X MLP and Harbor ETF 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 Harbor ETF Trust 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 MLP has no effect on the direction of Harbor ETF i.e., Harbor ETF and Global X go up and down completely randomly.

Pair Corralation between Harbor ETF and Global X

Given the investment horizon of 90 days Harbor ETF is expected to generate 1.78 times less return on investment than Global X. In addition to that, Harbor ETF is 1.28 times more volatile than Global X MLP. It trades about 0.08 of its total potential returns per unit of risk. Global X MLP is currently generating about 0.19 per unit of volatility. If you would invest  4,799  in Global X MLP on December 20, 2024 and sell it today you would earn a total of  585.00  from holding Global X MLP or generate 12.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Harbor ETF Trust  vs.  Global X MLP

Harbor ETF Trust

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Harbor ETF Trust are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak technical and fundamental indicators, Harbor ETF may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Global X MLP

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Global X MLP are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Global X sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Harbor ETF and Global X

The main advantage of trading using opposite Harbor ETF and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harbor ETF 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 Harbor ETF Trust and Global X MLP 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.

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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.