Correlation Between Acadian Emerging and Fidelity China
Can any of the company-specific risk be diversified away by investing in both Acadian Emerging and Fidelity China 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 Acadian Emerging and Fidelity China into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acadian Emerging Markets and Fidelity China Region, you can compare the effects of market volatilities on Acadian Emerging and Fidelity China 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 Acadian Emerging with a short position of Fidelity China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acadian Emerging and Fidelity China.
Diversification Opportunities for Acadian Emerging and Fidelity China
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Acadian and Fidelity is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Acadian Emerging Markets and Fidelity China Region in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity China Region and Acadian Emerging 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 Acadian Emerging Markets are associated (or correlated) with Fidelity China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity China Region has no effect on the direction of Acadian Emerging i.e., Acadian Emerging and Fidelity China go up and down completely randomly.
Pair Corralation between Acadian Emerging and Fidelity China
Assuming the 90 days horizon Acadian Emerging Markets is expected to generate 0.5 times more return on investment than Fidelity China. However, Acadian Emerging Markets is 1.99 times less risky than Fidelity China. It trades about -0.19 of its potential returns per unit of risk. Fidelity China Region is currently generating about -0.2 per unit of risk. If you would invest 2,411 in Acadian Emerging Markets on August 27, 2024 and sell it today you would lose (71.00) from holding Acadian Emerging Markets or give up 2.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acadian Emerging Markets vs. Fidelity China Region
Performance |
| Timeline |
| Acadian Emerging Markets |
| Fidelity China Region |
Acadian Emerging and Fidelity China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acadian Emerging and Fidelity China
The main advantage of trading using opposite Acadian Emerging and Fidelity China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acadian Emerging position performs unexpectedly, Fidelity China 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 China will offset losses from the drop in Fidelity China's long position.| Acadian Emerging vs. International Stock Fund | Acadian Emerging vs. Pear Tree Polaris | Acadian Emerging vs. Jpmorgan Value Advantage | Acadian Emerging vs. Bridge Builder Smallmid |
| Fidelity China vs. Fidelity China Region | Fidelity China vs. Fidelity China Region | Fidelity China vs. Fidelity Advisor Emerging | Fidelity China vs. Fidelity Advisor Biotechnology |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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