Correlation Between Dfa International and Dfa Ca

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

By analyzing existing cross correlation between Dfa International Social and Dfa Ca Int Tr, you can compare the effects of market volatilities on Dfa International and Dfa Ca 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 International with a short position of Dfa Ca. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dfa International and Dfa Ca.

Diversification Opportunities for Dfa International and Dfa Ca

0.51

Correlation Coefficient

Dfa International  Dfa Ca

Very weak diversification

The 3 months correlation between Dfa and Dfa is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Dfa International Social and Dfa Ca Int Tr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dfa Ca Int and Dfa International 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 International Social are associated (or correlated) with Dfa Ca. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dfa Ca Int has no effect on the direction of Dfa International i.e., Dfa International and Dfa Ca go up and down completely randomly.

Pair Corralation between Dfa International and Dfa Ca

Assuming the 90 days horizon Dfa International Social is expected to generate 9.35 times more return on investment than Dfa Ca. However, Dfa International is 9.35 times more volatile than Dfa Ca Int Tr. It trades about 0.24 of its potential returns per unit of risk. Dfa Ca Int Tr is currently generating about 0.15 per unit of risk. If you would invest  1,585  in Dfa International Social on May 1, 2025 and sell it today you would earn a total of  168.00  from holding Dfa International Social or generate 10.6% return on investment over 90 days.

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

Dfa International Social  vs.  Dfa Ca Int Tr

Dfa International Social

Risk-Adjusted Performance

Solid

Over the last 90 days Dfa International Social has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly weak essential indicators, Dfa International may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Dfa Ca Int

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Dfa Ca Int Tr are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental drivers, Dfa Ca is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Dfa International and Dfa Ca

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

The idea behind Dfa International Social and Dfa Ca Int Tr 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.