Correlation Between Dimensional International and Vanguard Growth
Can any of the company-specific risk be diversified away by investing in both Dimensional International and Vanguard Growth 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 International and Vanguard Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dimensional International High and Vanguard Growth Index, you can compare the effects of market volatilities on Dimensional International and Vanguard Growth 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 International with a short position of Vanguard Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dimensional International and Vanguard Growth.
Diversification Opportunities for Dimensional International and Vanguard Growth
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dimensional and Vanguard is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Dimensional International High and Vanguard Growth Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Growth Index and Dimensional International 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 International High are associated (or correlated) with Vanguard Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Growth Index has no effect on the direction of Dimensional International i.e., Dimensional International and Vanguard Growth go up and down completely randomly.
Pair Corralation between Dimensional International and Vanguard Growth
Given the investment horizon of 90 days Dimensional International is expected to generate 1.98 times less return on investment than Vanguard Growth. But when comparing it to its historical volatility, Dimensional International High is 1.32 times less risky than Vanguard Growth. It trades about 0.09 of its potential returns per unit of risk. Vanguard Growth Index is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 41,976 in Vanguard Growth Index on September 2, 2025 and sell it today you would earn a total of 7,108 from holding Vanguard Growth Index or generate 16.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dimensional International High vs. Vanguard Growth Index
Performance |
| Timeline |
| Dimensional International |
| Vanguard Growth Index |
Dimensional International and Vanguard Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dimensional International and Vanguard Growth
The main advantage of trading using opposite Dimensional International and Vanguard Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dimensional International position performs unexpectedly, Vanguard Growth 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 Vanguard Growth will offset losses from the drop in Vanguard Growth's long position.| Dimensional International vs. FT Vest Equity | Dimensional International vs. Northern Lights | Dimensional International vs. Diamond Hill Funds | Dimensional International vs. JPMorgan Fundamental Data |
| Vanguard Growth vs. FT Vest Equity | Vanguard Growth vs. Northern Lights | Vanguard Growth vs. Diamond Hill Funds | Vanguard Growth 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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