Correlation Between Global Net and Impax Environmental

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

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

Diversification Opportunities for Global Net and Impax Environmental

0.65

Correlation Coefficient

Global Net  Impax Environmental

Poor diversification

The 3 months correlation between Global and Impax is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Global Net Lease and Impax Environmental Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Impax Environmental and Global Net 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 Net Lease are associated (or correlated) with Impax Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Impax Environmental has no effect on the direction of Global Net i.e., Global Net and Impax Environmental go up and down completely randomly.

Pair Corralation between Global Net and Impax Environmental

Assuming the 90 days trading horizon Global Net Lease is expected to generate 1.88 times more return on investment than Impax Environmental. However, Global Net is 1.88 times more volatile than Impax Environmental Markets. It trades about 0.0 of its potential returns per unit of risk. Impax Environmental Markets is currently generating about 0.0 per unit of risk. If you would invest  837.00  in Global Net Lease on April 6, 2025 and sell it today you would lose (70.00) from holding Global Net Lease or give up 8.36% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.2%
Values	Daily Returns

Global Net Lease  vs.  Impax Environmental Markets

Global Net Lease

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Global Net Lease are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Global Net may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Impax Environmental

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Impax Environmental Markets are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Impax Environmental exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Global Net and Impax Environmental

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

The idea behind Global Net Lease and Impax Environmental Markets 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.