Correlation Between Vanguard Conservative and Global X

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

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

Diversification Opportunities for Vanguard Conservative and Global X

0.99

Correlation Coefficient

Vanguard Conservative  Global X

No risk reduction

The 3 months correlation between Vanguard and Global is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Conservative ETF and Global X Conservative in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Conservative and Vanguard Conservative 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 Vanguard Conservative ETF 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 Conservative has no effect on the direction of Vanguard Conservative i.e., Vanguard Conservative and Global X go up and down completely randomly.

Pair Corralation between Vanguard Conservative and Global X

Assuming the 90 days trading horizon Vanguard Conservative ETF is expected to generate 0.82 times more return on investment than Global X. However, Vanguard Conservative ETF is 1.22 times less risky than Global X. It trades about 0.3 of its potential returns per unit of risk. Global X Conservative is currently generating about 0.23 per unit of risk. If you would invest  2,841  in Vanguard Conservative ETF on April 22, 2025 and sell it today you would earn a total of  166.00  from holding Vanguard Conservative ETF or generate 5.84% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	98.44%
Values	Daily Returns

Vanguard Conservative ETF  vs.  Global X Conservative

Vanguard Conservative ETF

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Vanguard Conservative ETF are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Vanguard Conservative is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Global X Conservative

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Global X Conservative are ranked lower than 17 (%) 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 Vanguard Conservative and Global X

The main advantage of trading using opposite Vanguard Conservative and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Conservative 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 Vanguard Conservative ETF and Global X Conservative 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.

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 Transaction History module to view history of all your transactions and understand their impact on performance.