Correlation Between Dimensional ETF and SPDR SSGA
Can any of the company-specific risk be diversified away by investing in both Dimensional ETF and SPDR SSGA 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 Dimensional ETF and SPDR SSGA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dimensional ETF Trust and SPDR SSGA Fixed, you can compare the effects of market volatilities on Dimensional ETF and SPDR SSGA 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 Dimensional ETF with a short position of SPDR SSGA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dimensional ETF and SPDR SSGA.
Diversification Opportunities for Dimensional ETF and SPDR SSGA
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Dimensional and SPDR is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Dimensional ETF Trust and SPDR SSGA Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR SSGA Fixed and Dimensional ETF 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 Dimensional ETF Trust are associated (or correlated) with SPDR SSGA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR SSGA Fixed has no effect on the direction of Dimensional ETF i.e., Dimensional ETF and SPDR SSGA go up and down completely randomly.
Pair Corralation between Dimensional ETF and SPDR SSGA
Given the investment horizon of 90 days Dimensional ETF Trust is expected to generate 0.9 times more return on investment than SPDR SSGA. However, Dimensional ETF Trust is 1.11 times less risky than SPDR SSGA. It trades about 0.05 of its potential returns per unit of risk. SPDR SSGA Fixed is currently generating about 0.03 per unit of risk. If you would invest 3,808 in Dimensional ETF Trust on November 19, 2024 and sell it today you would earn a total of 366.00 from holding Dimensional ETF Trust or generate 9.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dimensional ETF Trust vs. SPDR SSGA Fixed
Performance |
| Timeline |
| Dimensional ETF Trust |
| SPDR SSGA Fixed |
Dimensional ETF and SPDR SSGA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dimensional ETF and SPDR SSGA
The main advantage of trading using opposite Dimensional ETF and SPDR SSGA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dimensional ETF position performs unexpectedly, SPDR SSGA 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 SPDR SSGA will offset losses from the drop in SPDR SSGA's long position.| Dimensional ETF vs. Dimensional ETF Trust | Dimensional ETF vs. Dimensional Core Equity | Dimensional ETF vs. Dimensional ETF Trust | Dimensional ETF vs. Dimensional Emerging Core |
| SPDR SSGA vs. SPDR SSGA Sector | SPDR SSGA vs. SPDR DoubleLine Emerging | SPDR SSGA vs. SPDR DoubleLine Short | SPDR SSGA vs. SPDR SSgA Ultra |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |