Correlation Between TD Q and Global X

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

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

Diversification Opportunities for TD Q and Global X

0.89

Correlation Coefficient

TD Q  Global X

Very poor diversification

The 3 months correlation between TQGD and Global is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding TD Q Global and Global X Active in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Active and TD Q 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 TD Q Global 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 Active has no effect on the direction of TD Q i.e., TD Q and Global X go up and down completely randomly.

Pair Corralation between TD Q and Global X

Assuming the 90 days trading horizon TD Q Global is expected to generate 1.17 times more return on investment than Global X. However, TD Q is 1.17 times more volatile than Global X Active. It trades about 0.24 of its potential returns per unit of risk. Global X Active is currently generating about 0.13 per unit of risk. If you would invest  1,921  in TD Q Global on April 25, 2025 and sell it today you would earn a total of  228.00  from holding TD Q Global or generate 11.87% return on investment over 90 days.

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

TD Q Global  vs.  Global X Active

TD Q Global

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in TD Q Global are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, TD Q may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Global X Active

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Global X Active are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Global X is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with TD Q and Global X

The main advantage of trading using opposite TD Q and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TD Q 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 TD Q Global and Global X Active 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.