Correlation Between YieldMax N and Dimensional ETF

Can any of the company-specific risk be diversified away by investing in both YieldMax N and Dimensional ETF 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 YieldMax N and Dimensional ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between YieldMax N Option and Dimensional ETF Trust, you can compare the effects of market volatilities on YieldMax N and Dimensional ETF 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 YieldMax N with a short position of Dimensional ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of YieldMax N and Dimensional ETF.

Diversification Opportunities for YieldMax N and Dimensional ETF

0.93

Correlation Coefficient

YieldMax N  Dimensional ETF

Almost no diversification

The 3 months correlation between YieldMax and Dimensional is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding YieldMax N Option and Dimensional ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dimensional ETF Trust and YieldMax N 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 YieldMax N Option are associated (or correlated) with Dimensional ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dimensional ETF Trust has no effect on the direction of YieldMax N i.e., YieldMax N and Dimensional ETF go up and down completely randomly.

Pair Corralation between YieldMax N and Dimensional ETF

Given the investment horizon of 90 days YieldMax N Option is expected to under-perform the Dimensional ETF. In addition to that, YieldMax N is 5.84 times more volatile than Dimensional ETF Trust. It trades about -0.14 of its total potential returns per unit of risk. Dimensional ETF Trust is currently generating about -0.02 per unit of volatility. If you would invest  2,988  in Dimensional ETF Trust on May 3, 2025 and sell it today you would lose (8.50) from holding Dimensional ETF Trust or give up 0.28% of portfolio value over 90 days.

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

YieldMax N Option  vs.  Dimensional ETF Trust

YieldMax N Option

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in YieldMax N Option are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, YieldMax N showed solid returns over the last few months and may actually be approaching a breakup point.

Dimensional ETF Trust

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Dimensional ETF Trust are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating technical and fundamental indicators, Dimensional ETF may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with YieldMax N and Dimensional ETF

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

The idea behind YieldMax N Option and Dimensional ETF Trust 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.