Correlation Between Natixis ETF and Global X

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

Diversification Opportunities for Natixis ETF and Global X

0.99

Correlation Coefficient

Natixis ETF  Global X

No risk reduction

The 3 months correlation between Natixis and Global is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Natixis ETF Trust and Global X SP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X SP and Natixis 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 Natixis 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 SP has no effect on the direction of Natixis ETF i.e., Natixis ETF and Global X go up and down completely randomly.

Pair Corralation between Natixis ETF and Global X

Considering the 90-day investment horizon Natixis ETF is expected to generate 1.05 times less return on investment than Global X. In addition to that, Natixis ETF is 1.12 times more volatile than Global X SP. It trades about 0.34 of its total potential returns per unit of risk. Global X SP is currently generating about 0.4 per unit of volatility. If you would invest  3,163  in Global X SP on September 5, 2024 and sell it today you would earn a total of  169.00  from holding Global X SP or generate 5.34% return on investment over 90 days.

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

Natixis ETF Trust  vs.  Global X SP

Natixis ETF Trust

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Natixis ETF Trust are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite fairly unsteady basic indicators, Natixis ETF may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Global X SP

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Global X SP are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady essential indicators, Global X may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Natixis ETF and Global X

The main advantage of trading using opposite Natixis ETF and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Natixis 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 Natixis ETF Trust and Global X SP 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.