Correlation Between Short Duration and Glg Intl
Can any of the company-specific risk be diversified away by investing in both Short Duration and Glg Intl 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 Short Duration and Glg Intl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Short Duration Inflation and Glg Intl Small, you can compare the effects of market volatilities on Short Duration and Glg Intl 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 Short Duration with a short position of Glg Intl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Short Duration and Glg Intl.
Diversification Opportunities for Short Duration and Glg Intl
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Short and Glg is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Short Duration Inflation and Glg Intl Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glg Intl Small and Short Duration 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 Short Duration Inflation are associated (or correlated) with Glg Intl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glg Intl Small has no effect on the direction of Short Duration i.e., Short Duration and Glg Intl go up and down completely randomly.
Pair Corralation between Short Duration and Glg Intl
Assuming the 90 days horizon Short Duration is expected to generate 19.69 times less return on investment than Glg Intl. But when comparing it to its historical volatility, Short Duration Inflation is 6.49 times less risky than Glg Intl. It trades about 0.08 of its potential returns per unit of risk. Glg Intl Small is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 8,093 in Glg Intl Small on April 26, 2025 and sell it today you would earn a total of 1,115 from holding Glg Intl Small or generate 13.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Short Duration Inflation vs. Glg Intl Small
Performance |
| Timeline |
| Short Duration Inflation |
| Glg Intl Small |
Short Duration and Glg Intl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Short Duration and Glg Intl
The main advantage of trading using opposite Short Duration and Glg Intl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Short Duration position performs unexpectedly, Glg Intl 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 Glg Intl will offset losses from the drop in Glg Intl's long position.| Short Duration vs. Redwood Real Estate | Short Duration vs. Real Estate Ultrasector | Short Duration vs. Global Real Estate | Short Duration vs. Pender Real Estate |
| Glg Intl vs. Amg Managers Centersquare | Glg Intl vs. Dfa Real Estate | Glg Intl vs. Franklin Real Estate | Glg Intl vs. Prudential Real Estate |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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