Correlation Between Invesco and Global X

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

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

Diversification Opportunities for Invesco and Global X

-0.37

Correlation Coefficient

Invesco  Global X

Very good diversification

The 3 months correlation between Invesco and Global is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Invesco and Global X Thematic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Thematic and Invesco 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 Invesco 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 Thematic has no effect on the direction of Invesco i.e., Invesco and Global X go up and down completely randomly.

Pair Corralation between Invesco and Global X

If you would invest  3,479  in Invesco on September 24, 2024 and sell it today you would earn a total of  0.00  from holding Invesco or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	3.08%
Values	Daily Returns

Invesco  vs.  Global X Thematic

Invesco

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Invesco has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental indicators, Invesco is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Global X Thematic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Global X Thematic has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Global X is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Invesco and Global X

The main advantage of trading using opposite Invesco and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco 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 Invesco and Global X Thematic 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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.