Correlation Between Dfa Real and Eaton Vance

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

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

Diversification Opportunities for Dfa Real and Eaton Vance

-0.24

Correlation Coefficient

Dfa Real  Eaton Vance

Very good diversification

The 3 months correlation between Dfa and Eaton is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Dfa Real Estate and Eaton Vance Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Short and Dfa Real 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 Real Estate are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Short has no effect on the direction of Dfa Real i.e., Dfa Real and Eaton Vance go up and down completely randomly.

Pair Corralation between Dfa Real and Eaton Vance

Assuming the 90 days horizon Dfa Real is expected to generate 1.51 times less return on investment than Eaton Vance. In addition to that, Dfa Real is 4.59 times more volatile than Eaton Vance Short. It trades about 0.02 of its total potential returns per unit of risk. Eaton Vance Short is currently generating about 0.11 per unit of volatility. If you would invest  585.00  in Eaton Vance Short on October 25, 2024 and sell it today you would earn a total of  79.00  from holding Eaton Vance Short or generate 13.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Dfa Real Estate  vs.  Eaton Vance Short

Dfa Real Estate

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dfa Real Estate has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Eaton Vance Short

Risk-Adjusted Performance

11 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Eaton Vance Short are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Eaton Vance 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 Real and Eaton Vance

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

The idea behind Dfa Real Estate and Eaton Vance Short 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.