Correlation Between Mairs Power and Dimensional ETF
Can any of the company-specific risk be diversified away by investing in both Mairs Power 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 Mairs Power and Dimensional ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mairs Power Minnesota and Dimensional ETF Trust, you can compare the effects of market volatilities on Mairs Power 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 Mairs Power with a short position of Dimensional ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mairs Power and Dimensional ETF.
Diversification Opportunities for Mairs Power and Dimensional ETF
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Mairs and Dimensional is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Mairs Power Minnesota 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 Mairs Power 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 Mairs Power Minnesota 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 Mairs Power i.e., Mairs Power and Dimensional ETF go up and down completely randomly.
Pair Corralation between Mairs Power and Dimensional ETF
Given the investment horizon of 90 days Mairs Power Minnesota is expected to generate 1.58 times more return on investment than Dimensional ETF. However, Mairs Power is 1.58 times more volatile than Dimensional ETF Trust. It trades about 0.21 of its potential returns per unit of risk. Dimensional ETF Trust is currently generating about 0.26 per unit of risk. If you would invest 2,206 in Mairs Power Minnesota on September 1, 2024 and sell it today you would earn a total of 28.00 from holding Mairs Power Minnesota or generate 1.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mairs Power Minnesota vs. Dimensional ETF Trust
Performance |
| Timeline |
| Mairs Power Minnesota |
| Dimensional ETF Trust |
Mairs Power and Dimensional ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mairs Power and Dimensional ETF
The main advantage of trading using opposite Mairs Power and Dimensional ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mairs Power 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.| Mairs Power vs. BlackRock Intermediate Muni | Mairs Power vs. IQ MacKay Municipal | Mairs Power vs. Overlay Shares Municipal | Mairs Power vs. IQ MacKay Municipal |
| Dimensional ETF vs. Dimensional ETF Trust | Dimensional ETF vs. Dimensional ETF Trust | Dimensional ETF vs. Dimensional ETF Trust | Dimensional ETF vs. Dimensional Emerging Core |
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.
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