Correlation Between Mast Global and Global X

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

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

Diversification Opportunities for Mast Global and Global X

-0.51

Correlation Coefficient

Mast Global  Global X

Excellent diversification

The 3 months correlation between Mast and Global is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Mast Global Battery and Global X Millennials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Millennials and Mast Global 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 Mast Global Battery 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 Millennials has no effect on the direction of Mast Global i.e., Mast Global and Global X go up and down completely randomly.

Pair Corralation between Mast Global and Global X

Allowing for the 90-day total investment horizon Mast Global Battery is expected to generate 1.33 times more return on investment than Global X. However, Mast Global is 1.33 times more volatile than Global X Millennials. It trades about -0.15 of its potential returns per unit of risk. Global X Millennials is currently generating about -0.26 per unit of risk. If you would invest  2,481  in Mast Global Battery on October 7, 2024 and sell it today you would lose (105.00) from holding Mast Global Battery or give up 4.23% of portfolio value over 90 days.

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

Mast Global Battery  vs.  Global X Millennials

Mast Global Battery

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mast Global Battery has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Etf's basic indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the fund sophisticated investors.

Global X Millennials

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Global X Millennials are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting essential indicators, Global X may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Mast Global and Global X

The main advantage of trading using opposite Mast Global and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mast Global 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 Mast Global Battery and Global X Millennials 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.