Correlation Between Global X and Mackenzie Canadian

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

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

Diversification Opportunities for Global X and Mackenzie Canadian

0.0

Correlation Coefficient

Global X  Mackenzie Canadian

Pay attention - limited upside

The 3 months correlation between Global and Mackenzie is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Global X Natural and Mackenzie Canadian Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mackenzie Canadian Equity and Global X 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 Global X Natural are associated (or correlated) with Mackenzie Canadian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mackenzie Canadian Equity has no effect on the direction of Global X i.e., Global X and Mackenzie Canadian go up and down completely randomly.

Pair Corralation between Global X and Mackenzie Canadian

If you would invest (100.00) in Mackenzie Canadian Equity on September 4, 2024 and sell it today you would earn a total of  100.00  from holding Mackenzie Canadian Equity or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Global X Natural  vs.  Mackenzie Canadian Equity

Global X Natural

Risk-Adjusted Performance

0 of 100

Weak

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

Mackenzie Canadian Equity

Risk-Adjusted Performance

0 of 100

Strong

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

Pair Trading with Global X and Mackenzie Canadian

The main advantage of trading using opposite Global X and Mackenzie Canadian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Mackenzie Canadian 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 Mackenzie Canadian will offset losses from the drop in Mackenzie Canadian's long position.

The idea behind Global X Natural and Mackenzie Canadian Equity 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.

Check out your portfolio center.

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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.