Correlation Between Guidemark(r) Small/mid and Dfa Oregon

Can any of the company-specific risk be diversified away by investing in both Guidemark(r) Small/mid and Dfa Oregon 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 Guidemark(r) Small/mid and Dfa Oregon into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Guidemark Smallmid Cap and Dfa Oregon Municipal, you can compare the effects of market volatilities on Guidemark(r) Small/mid and Dfa Oregon 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 Guidemark(r) Small/mid with a short position of Dfa Oregon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guidemark(r) Small/mid and Dfa Oregon.

Diversification Opportunities for Guidemark(r) Small/mid and Dfa Oregon

0.09

Correlation Coefficient

Guidemark(r) Small/mid  Dfa Oregon

Significant diversification

The 3 months correlation between Guidemark(r) and Dfa is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Guidemark Smallmid Cap and Dfa Oregon Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dfa Oregon Municipal and Guidemark(r) Small/mid 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 Guidemark Smallmid Cap are associated (or correlated) with Dfa Oregon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dfa Oregon Municipal has no effect on the direction of Guidemark(r) Small/mid i.e., Guidemark(r) Small/mid and Dfa Oregon go up and down completely randomly.

Pair Corralation between Guidemark(r) Small/mid and Dfa Oregon

Assuming the 90 days horizon Guidemark Smallmid Cap is expected to under-perform the Dfa Oregon. In addition to that, Guidemark(r) Small/mid is 13.88 times more volatile than Dfa Oregon Municipal. It trades about -0.21 of its total potential returns per unit of risk. Dfa Oregon Municipal is currently generating about 0.03 per unit of volatility. If you would invest  982.00  in Dfa Oregon Municipal on December 4, 2024 and sell it today you would earn a total of  2.00  from holding Dfa Oregon Municipal or generate 0.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.33%
Values	Daily Returns

Guidemark Smallmid Cap  vs.  Dfa Oregon Municipal

Guidemark Smallmid Cap

Risk-Adjusted Performance

Very Weak

Over the last 90 days Guidemark Smallmid Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's primary indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Dfa Oregon Municipal

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Dfa Oregon Municipal are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong primary indicators, Dfa Oregon is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Guidemark(r) Small/mid and Dfa Oregon

The main advantage of trading using opposite Guidemark(r) Small/mid and Dfa Oregon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guidemark(r) Small/mid position performs unexpectedly, Dfa Oregon 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 Dfa Oregon will offset losses from the drop in Dfa Oregon's long position.

The idea behind Guidemark Smallmid Cap and Dfa Oregon Municipal 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.