Correlation Between Global X and Otis Gold

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

By analyzing existing cross correlation between Global X Robotics and Otis Gold Corp, you can compare the effects of market volatilities on Global X and Otis Gold 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 Otis Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Otis Gold.

Diversification Opportunities for Global X and Otis Gold

0.0

Correlation Coefficient

Global X  Otis Gold

Pay attention - limited upside

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

Pair Corralation between Global X and Otis Gold

If you would invest  2,703  in Global X Robotics on February 29, 2024 and sell it today you would earn a total of  452.00  from holding Global X Robotics or generate 16.72% return on investment over 90 days.

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

Global X Robotics  vs.  Otis Gold Corp

Global X Robotics

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Global X Robotics are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Global X is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Otis Gold Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Global X and Otis Gold

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

The idea behind Global X Robotics and Otis Gold Corp 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.