Correlation Between Dfa Real and Tiaa-cref Intl

Can any of the company-specific risk be diversified away by investing in both Dfa Real and Tiaa-cref Intl 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 Dfa Real and Tiaa-cref Intl into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dfa Real Estate and Tiaa Cref Intl Small Cap, you can compare the effects of market volatilities on Dfa Real and Tiaa-cref Intl 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 Dfa Real with a short position of Tiaa-cref Intl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dfa Real and Tiaa-cref Intl.

Diversification Opportunities for Dfa Real and Tiaa-cref Intl

0.22

Correlation Coefficient

Dfa Real  Tiaa-cref Intl

Modest diversification

The 3 months correlation between Dfa and Tiaa-cref is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Dfa Real Estate and Tiaa Cref Intl Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tiaa Cref Intl and Dfa Real 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 Dfa Real Estate are associated (or correlated) with Tiaa-cref Intl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tiaa Cref Intl has no effect on the direction of Dfa Real i.e., Dfa Real and Tiaa-cref Intl go up and down completely randomly.

Pair Corralation between Dfa Real and Tiaa-cref Intl

Assuming the 90 days horizon Dfa Real Estate is expected to under-perform the Tiaa-cref Intl. In addition to that, Dfa Real is 1.35 times more volatile than Tiaa Cref Intl Small Cap. It trades about -0.04 of its total potential returns per unit of risk. Tiaa Cref Intl Small Cap is currently generating about 0.32 per unit of volatility. If you would invest  1,208  in Tiaa Cref Intl Small Cap on May 16, 2025 and sell it today you would earn a total of  160.00  from holding Tiaa Cref Intl Small Cap or generate 13.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.39%
Values	Daily Returns

Dfa Real Estate  vs.  Tiaa Cref Intl Small Cap

Dfa Real Estate

Risk-Adjusted Performance

Weakest

Over the last 90 days Dfa Real Estate has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Dfa Real is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Tiaa Cref Intl

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Tiaa Cref Intl Small Cap are ranked lower than 25 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Tiaa-cref Intl showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Dfa Real and Tiaa-cref Intl

The main advantage of trading using opposite Dfa Real and Tiaa-cref Intl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dfa Real position performs unexpectedly, Tiaa-cref Intl 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 Tiaa-cref Intl will offset losses from the drop in Tiaa-cref Intl's long position.

The idea behind Dfa Real Estate and Tiaa Cref Intl Small Cap 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.