Correlation Between CI Canadian and Global X

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

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

Diversification Opportunities for CI Canadian and Global X

0.97

Correlation Coefficient

CI Canadian  Global X

Almost no diversification

The 3 months correlation between RIT and Global is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding CI Canadian REIT and Global X Equal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Equal and CI Canadian 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 CI Canadian REIT 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 Equal has no effect on the direction of CI Canadian i.e., CI Canadian and Global X go up and down completely randomly.

Pair Corralation between CI Canadian and Global X

Assuming the 90 days trading horizon CI Canadian is expected to generate 1.03 times less return on investment than Global X. But when comparing it to its historical volatility, CI Canadian REIT is 1.0 times less risky than Global X. It trades about 0.2 of its potential returns per unit of risk. Global X Equal is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  2,607  in Global X Equal on April 25, 2025 and sell it today you would earn a total of  264.00  from holding Global X Equal or generate 10.13% return on investment over 90 days.

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

CI Canadian REIT  vs.  Global X Equal

CI Canadian REIT

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in CI Canadian REIT are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, CI Canadian may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Global X Equal

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Global X Equal are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Global X may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with CI Canadian and Global X

The main advantage of trading using opposite CI Canadian and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Canadian 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 CI Canadian REIT and Global X Equal 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.