Correlation Between Dfa Selectively and Dfa Short

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

By analyzing existing cross correlation between Dfa Selectively Hedged and Dfa Short Term Extended, you can compare the effects of market volatilities on Dfa Selectively and Dfa Short 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 Selectively with a short position of Dfa Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dfa Selectively and Dfa Short.

Diversification Opportunities for Dfa Selectively and Dfa Short

0.96

Correlation Coefficient

Dfa Selectively  Dfa Short

Almost no diversification

The 3 months correlation between Dfa and Dfa is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Dfa Selectively Hedged and Dfa Short Term Extended in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dfa Short Term and Dfa Selectively 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 Selectively Hedged are associated (or correlated) with Dfa Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dfa Short Term has no effect on the direction of Dfa Selectively i.e., Dfa Selectively and Dfa Short go up and down completely randomly.

Pair Corralation between Dfa Selectively and Dfa Short

If you would invest  2,308  in Dfa Selectively Hedged on May 5, 2025 and sell it today you would earn a total of  0.00  from holding Dfa Selectively Hedged or generate 0.0% return on investment over 90 days.

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

Dfa Selectively Hedged  vs.  Dfa Short Term Extended

Dfa Selectively Hedged

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Dfa Selectively Hedged are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Dfa Selectively may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Dfa Short Term

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Dfa Short Term Extended are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Dfa Short 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 Selectively and Dfa Short

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

The idea behind Dfa Selectively Hedged and Dfa Short Term Extended 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.