Correlation Between Global X and Dynamic Active

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

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

Diversification Opportunities for Global X and Dynamic Active

0.63

Correlation Coefficient

Global X  Dynamic Active

Poor diversification

The 3 months correlation between Global and Dynamic is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Global X Enhanced and Dynamic Active Canadian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dynamic Active Canadian and Global X 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 X Enhanced are associated (or correlated) with Dynamic Active. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dynamic Active Canadian has no effect on the direction of Global X i.e., Global X and Dynamic Active go up and down completely randomly.

Pair Corralation between Global X and Dynamic Active

Assuming the 90 days trading horizon Global X Enhanced is expected to generate 1.88 times more return on investment than Dynamic Active. However, Global X is 1.88 times more volatile than Dynamic Active Canadian. It trades about 0.16 of its potential returns per unit of risk. Dynamic Active Canadian is currently generating about 0.14 per unit of risk. If you would invest  2,965  in Global X Enhanced on September 9, 2025 and sell it today you would earn a total of  302.00  from holding Global X Enhanced or generate 10.19% return on investment over 90 days.

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

Global X Enhanced  vs.  Dynamic Active Canadian

Global X Enhanced

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Global X Enhanced are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Global X may actually be approaching a critical reversion point that can send shares even higher in January 2026.

Dynamic Active Canadian

Risk-Adjusted Performance

Fair

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

Pair Trading with Global X and Dynamic Active

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

The idea behind Global X Enhanced and Dynamic Active Canadian 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.