Correlation Between GraniteShares 125x and Dimensional ETF

Can any of the company-specific risk be diversified away by investing in both GraniteShares 125x and Dimensional ETF 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 GraniteShares 125x and Dimensional ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GraniteShares 125x Long and Dimensional ETF Trust, you can compare the effects of market volatilities on GraniteShares 125x and Dimensional ETF 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 GraniteShares 125x with a short position of Dimensional ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares 125x and Dimensional ETF.

Diversification Opportunities for GraniteShares 125x and Dimensional ETF

-0.71

Correlation Coefficient

GraniteShares 125x  Dimensional ETF

Pay attention - limited upside

The 3 months correlation between GraniteShares and Dimensional is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares 125x Long and Dimensional ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dimensional ETF Trust and GraniteShares 125x 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 GraniteShares 125x Long are associated (or correlated) with Dimensional ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dimensional ETF Trust has no effect on the direction of GraniteShares 125x i.e., GraniteShares 125x and Dimensional ETF go up and down completely randomly.

Pair Corralation between GraniteShares 125x and Dimensional ETF

Considering the 90-day investment horizon GraniteShares 125x Long is expected to under-perform the Dimensional ETF. In addition to that, GraniteShares 125x is 17.57 times more volatile than Dimensional ETF Trust. It trades about -0.1 of its total potential returns per unit of risk. Dimensional ETF Trust is currently generating about 0.1 per unit of volatility. If you would invest  4,125  in Dimensional ETF Trust on December 4, 2024 and sell it today you would earn a total of  66.00  from holding Dimensional ETF Trust or generate 1.6% return on investment over 90 days.

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

GraniteShares 125x Long  vs.  Dimensional ETF Trust

GraniteShares 125x Long

Risk-Adjusted Performance

Very Weak

Over the last 90 days GraniteShares 125x Long has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Etf's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the ETF venture institutional investors.

Dimensional ETF Trust

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Dimensional ETF Trust are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. 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.

Pair Trading with GraniteShares 125x and Dimensional ETF

The main advantage of trading using opposite GraniteShares 125x and Dimensional ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GraniteShares 125x position performs unexpectedly, Dimensional ETF 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 Dimensional ETF will offset losses from the drop in Dimensional ETF's long position.

The idea behind GraniteShares 125x Long and Dimensional ETF Trust 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.