Correlation Between Robo Global and Global X

Can any of the company-specific risk be diversified away by investing in both Robo 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 Robo 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 Robo Global Artificial and Global X Telemedicine, you can compare the effects of market volatilities on Robo 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 Robo Global with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Robo Global and Global X.

Diversification Opportunities for Robo Global and Global X

0.88

Correlation Coefficient

Robo Global  Global X

Very poor diversification

The 3 months correlation between Robo and Global is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Robo Global Artificial and Global X Telemedicine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Telemedicine and Robo 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 Robo Global Artificial 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 Telemedicine has no effect on the direction of Robo Global i.e., Robo Global and Global X go up and down completely randomly.

Pair Corralation between Robo Global and Global X

Given the investment horizon of 90 days Robo Global Artificial is expected to under-perform the Global X. But the etf apears to be less risky and, when comparing its historical volatility, Robo Global Artificial is 1.1 times less risky than Global X. The etf trades about -0.03 of its potential returns per unit of risk. The Global X Telemedicine is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  986.00  in Global X Telemedicine on December 18, 2024 and sell it today you would earn a total of  14.00  from holding Global X Telemedicine or generate 1.42% return on investment over 90 days.

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

Robo Global Artificial  vs.  Global X Telemedicine

Robo Global Artificial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Robo Global Artificial has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Robo Global is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Global X Telemedicine

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Global X Telemedicine are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Global X is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Robo Global and Global X

The main advantage of trading using opposite Robo Global and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Robo 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 Robo Global Artificial and Global X Telemedicine 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..