Correlation Between CI Global and Fidelity Technology
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By analyzing existing cross correlation between CI Global Alpha and Fidelity Technology Innovators, you can compare the effects of market volatilities on CI Global and Fidelity Technology 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 CI Global with a short position of Fidelity Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Global and Fidelity Technology.
Diversification Opportunities for CI Global and Fidelity Technology
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between 0P000070HA and Fidelity is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding CI Global Alpha and Fidelity Technology Innovators in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Technology and CI Global 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 CI Global Alpha are associated (or correlated) with Fidelity Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Technology has no effect on the direction of CI Global i.e., CI Global and Fidelity Technology go up and down completely randomly.
Pair Corralation between CI Global and Fidelity Technology
Assuming the 90 days trading horizon CI Global Alpha is expected to generate 1.55 times more return on investment than Fidelity Technology. However, CI Global is 1.55 times more volatile than Fidelity Technology Innovators. It trades about 0.12 of its potential returns per unit of risk. Fidelity Technology Innovators is currently generating about 0.11 per unit of risk. If you would invest 4,696 in CI Global Alpha on August 25, 2024 and sell it today you would earn a total of 5,595 from holding CI Global Alpha or generate 119.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
CI Global Alpha vs. Fidelity Technology Innovators
Performance |
| Timeline |
| CI Global Alpha |
| Fidelity Technology |
CI Global and Fidelity Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CI Global and Fidelity Technology
The main advantage of trading using opposite CI Global and Fidelity Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CI Global position performs unexpectedly, Fidelity Technology 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 Fidelity Technology will offset losses from the drop in Fidelity Technology's long position.The idea behind CI Global Alpha and Fidelity Technology Innovators pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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