Correlation Between Listed Funds and Dimensional International

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

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

Diversification Opportunities for Listed Funds and Dimensional International

-0.78

Correlation Coefficient

Listed Funds  Dimensional International

Pay attention - limited upside

The 3 months correlation between Listed and Dimensional is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Listed Funds Trust and Dimensional International High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dimensional International and Listed Funds 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 Listed Funds Trust are associated (or correlated) with Dimensional International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dimensional International has no effect on the direction of Listed Funds i.e., Listed Funds and Dimensional International go up and down completely randomly.

Pair Corralation between Listed Funds and Dimensional International

Considering the 90-day investment horizon Listed Funds is expected to generate 1.24 times less return on investment than Dimensional International. But when comparing it to its historical volatility, Listed Funds Trust is 7.37 times less risky than Dimensional International. It trades about 0.27 of its potential returns per unit of risk. Dimensional International High is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  2,130  in Dimensional International High on September 26, 2024 and sell it today you would earn a total of  402.00  from holding Dimensional International High or generate 18.87% return on investment over 90 days.

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

Listed Funds Trust  vs.  Dimensional International High

Listed Funds Trust

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Listed Funds Trust are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Listed Funds is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Dimensional International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dimensional International High has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Etf's technical indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the ETF retail investors.

Pair Trading with Listed Funds and Dimensional International

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

The idea behind Listed Funds Trust and Dimensional International High 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.