Correlation Between Dimensional ETF and Anfield Dynamic

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

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

Diversification Opportunities for Dimensional ETF and Anfield Dynamic

0.95

Correlation Coefficient

Dimensional ETF  Anfield Dynamic

Almost no diversification

The 3 months correlation between Dimensional and Anfield is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Dimensional ETF Trust and Anfield Dynamic Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anfield Dynamic Fixed and Dimensional ETF 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 ETF Trust are associated (or correlated) with Anfield Dynamic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anfield Dynamic Fixed has no effect on the direction of Dimensional ETF i.e., Dimensional ETF and Anfield Dynamic go up and down completely randomly.

Pair Corralation between Dimensional ETF and Anfield Dynamic

Given the investment horizon of 90 days Dimensional ETF Trust is expected to generate about the same return on investment as Anfield Dynamic Fixed. However, Dimensional ETF is 1.0 times more volatile than Anfield Dynamic Fixed. It trades about 0.02 of its potential returns per unit of risk. Anfield Dynamic Fixed is currently producing about 0.02 per unit of risk. If you would invest  806.00  in Anfield Dynamic Fixed on October 4, 2024 and sell it today you would earn a total of  33.00  from holding Anfield Dynamic Fixed or generate 4.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	99.8%
Values	Daily Returns

Dimensional ETF Trust  vs.  Anfield Dynamic Fixed

Dimensional ETF Trust

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dimensional ETF Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable forward indicators, Dimensional ETF is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Anfield Dynamic Fixed

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Anfield Dynamic Fixed has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical and fundamental indicators, Anfield Dynamic is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Dimensional ETF and Anfield Dynamic

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

The idea behind Dimensional ETF Trust and Anfield Dynamic Fixed 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.

Check out your portfolio center.

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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.