Correlation Between Diamond Hill and Dimensional ETF
Can any of the company-specific risk be diversified away by investing in both Diamond Hill 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 Diamond Hill and Dimensional ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Diamond Hill Funds and Dimensional ETF Trust, you can compare the effects of market volatilities on Diamond Hill 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 Diamond Hill with a short position of Dimensional ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Diamond Hill and Dimensional ETF.
Diversification Opportunities for Diamond Hill and Dimensional ETF
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Diamond and Dimensional is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Diamond Hill Funds 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 Diamond Hill 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 Diamond Hill Funds 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 Diamond Hill i.e., Diamond Hill and Dimensional ETF go up and down completely randomly.
Pair Corralation between Diamond Hill and Dimensional ETF
Given the investment horizon of 90 days Diamond Hill Funds is expected to under-perform the Dimensional ETF. But the etf apears to be less risky and, when comparing its historical volatility, Diamond Hill Funds is 1.54 times less risky than Dimensional ETF. The etf trades about -0.03 of its potential returns per unit of risk. The Dimensional ETF Trust is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 3,192 in Dimensional ETF Trust on September 3, 2025 and sell it today you would earn a total of 74.00 from holding Dimensional ETF Trust or generate 2.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 70.31% |
| Values | Daily Returns |
Diamond Hill Funds vs. Dimensional ETF Trust
Performance |
| Timeline |
| Diamond Hill Funds |
| Dimensional ETF Trust |
Diamond Hill and Dimensional ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Diamond Hill and Dimensional ETF
The main advantage of trading using opposite Diamond Hill and Dimensional ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Diamond Hill 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.| Diamond Hill vs. FT Vest Equity | Diamond Hill vs. Northern Lights | Diamond Hill vs. Dimensional International High | Diamond Hill vs. JPMorgan Fundamental Data |
| Dimensional ETF vs. FT Vest Equity | Dimensional ETF vs. Northern Lights | Dimensional ETF vs. Diamond Hill Funds | Dimensional ETF vs. Dimensional International High |
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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