Correlation Between Astor Long/short and Dfa International
Can any of the company-specific risk be diversified away by investing in both Astor Long/short and Dfa 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 Astor Long/short and Dfa International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astor Longshort Fund and Dfa International Social, you can compare the effects of market volatilities on Astor Long/short and Dfa 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 Astor Long/short with a short position of Dfa International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astor Long/short and Dfa International.
Diversification Opportunities for Astor Long/short and Dfa International
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Astor and Dfa is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Astor Longshort Fund and Dfa International Social in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dfa International Social and Astor Long/short 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 Astor Longshort Fund are associated (or correlated) with Dfa International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dfa International Social has no effect on the direction of Astor Long/short i.e., Astor Long/short and Dfa International go up and down completely randomly.
Pair Corralation between Astor Long/short and Dfa International
Assuming the 90 days horizon Astor Longshort Fund is expected to under-perform the Dfa International. In addition to that, Astor Long/short is 3.32 times more volatile than Dfa International Social. It trades about -0.26 of its total potential returns per unit of risk. Dfa International Social is currently generating about -0.29 per unit of volatility. If you would invest 1,497 in Dfa International Social on October 7, 2024 and sell it today you would lose (55.00) from holding Dfa International Social or give up 3.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astor Longshort Fund vs. Dfa International Social
Performance |
| Timeline |
| Astor Long/short |
| Dfa International Social |
Astor Long/short and Dfa International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astor Long/short and Dfa International
The main advantage of trading using opposite Astor Long/short and Dfa International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astor Long/short position performs unexpectedly, Dfa 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 Dfa International will offset losses from the drop in Dfa International's long position.| Astor Long/short vs. Ab Small Cap | Astor Long/short vs. Vy Columbia Small | Astor Long/short vs. Sp Smallcap 600 | Astor Long/short vs. Glg Intl Small |
| Dfa International vs. Fidelity Capital Income | Dfa International vs. Calvert High Yield | Dfa International vs. Msift High Yield | Dfa International vs. Pace High Yield |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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