Correlation Between Dimensional Core and FIS Christian

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

By analyzing existing cross correlation between Dimensional Core Equity and FIS Christian Stock, you can compare the effects of market volatilities on Dimensional Core and FIS Christian 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 Dimensional Core with a short position of FIS Christian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dimensional Core and FIS Christian.

Diversification Opportunities for Dimensional Core and FIS Christian

0.69

Correlation Coefficient

Dimensional Core  FIS Christian

Poor diversification

The 3 months correlation between Dimensional and FIS is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Dimensional Core Equity and FIS Christian Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIS Christian Stock and Dimensional Core 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 Dimensional Core Equity are associated (or correlated) with FIS Christian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIS Christian Stock has no effect on the direction of Dimensional Core i.e., Dimensional Core and FIS Christian go up and down completely randomly.

Pair Corralation between Dimensional Core and FIS Christian

Given the investment horizon of 90 days Dimensional Core Equity is expected to generate 1.06 times more return on investment than FIS Christian. However, Dimensional Core is 1.06 times more volatile than FIS Christian Stock. It trades about 0.09 of its potential returns per unit of risk. FIS Christian Stock is currently generating about 0.07 per unit of risk. If you would invest  3,028  in Dimensional Core Equity on October 12, 2024 and sell it today you would earn a total of  457.00  from holding Dimensional Core Equity or generate 15.09% return on investment over 90 days.

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

Dimensional Core Equity  vs.  FIS Christian Stock

Dimensional Core Equity

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dimensional Core Equity has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Dimensional Core is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

FIS Christian Stock

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days FIS Christian Stock has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, FIS Christian is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Dimensional Core and FIS Christian

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

The idea behind Dimensional Core Equity and FIS Christian Stock 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.