Correlation Between DSJA and Avantis International

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

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

Diversification Opportunities for DSJA and Avantis International

0.0

Correlation Coefficient

DSJA  Avantis International

Pay attention - limited upside

The 3 months correlation between DSJA and Avantis is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding DSJA and Avantis International Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avantis International and DSJA 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 DSJA are associated (or correlated) with Avantis International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avantis International has no effect on the direction of DSJA i.e., DSJA and Avantis International go up and down completely randomly.

Pair Corralation between DSJA and Avantis International

If you would invest  6,131  in Avantis International Equity on December 28, 2024 and sell it today you would earn a total of  612.00  from holding Avantis International Equity or generate 9.98% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

DSJA  vs.  Avantis International Equity

DSJA

Risk-Adjusted Performance

Very Weak

Over the last 90 days DSJA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong forward-looking indicators, DSJA is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Avantis International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Avantis International Equity are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental indicators, Avantis International may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with DSJA and Avantis International

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

The idea behind DSJA and Avantis International Equity 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.