Correlation Between Pace Strategic and Dfa Ltip

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

By analyzing existing cross correlation between Pace Strategic Fixed and Dfa Ltip Portfolio, you can compare the effects of market volatilities on Pace Strategic and Dfa Ltip 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 Pace Strategic with a short position of Dfa Ltip. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pace Strategic and Dfa Ltip.

Diversification Opportunities for Pace Strategic and Dfa Ltip

0.76

Correlation Coefficient

Pace Strategic  Dfa Ltip

Poor diversification

The 3 months correlation between Pace and Dfa is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Pace Strategic Fixed and Dfa Ltip Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dfa Ltip Portfolio and Pace Strategic 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 Pace Strategic Fixed are associated (or correlated) with Dfa Ltip. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dfa Ltip Portfolio has no effect on the direction of Pace Strategic i.e., Pace Strategic and Dfa Ltip go up and down completely randomly.

Pair Corralation between Pace Strategic and Dfa Ltip

Assuming the 90 days horizon Pace Strategic Fixed is expected to under-perform the Dfa Ltip. But the mutual fund apears to be less risky and, when comparing its historical volatility, Pace Strategic Fixed is 3.91 times less risky than Dfa Ltip. The mutual fund trades about -0.02 of its potential returns per unit of risk. The Dfa Ltip Portfolio is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  536.00  in Dfa Ltip Portfolio on July 10, 2025 and sell it today you would earn a total of  0.00  from holding Dfa Ltip Portfolio or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.65%
Values	Daily Returns

Pace Strategic Fixed  vs.  Dfa Ltip Portfolio

Pace Strategic Fixed

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Pace Strategic Fixed are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Pace Strategic is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Dfa Ltip Portfolio

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Dfa Ltip Portfolio are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Dfa Ltip is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Pace Strategic and Dfa Ltip

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

The idea behind Pace Strategic Fixed and Dfa Ltip Portfolio 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 Commodity Directory module to find actively traded commodities issued by global exchanges.