Correlation Between Astar and Fidelity Flex
Can any of the company-specific risk be diversified away by investing in both Astar and Fidelity Flex 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 Astar and Fidelity Flex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astar and Fidelity Flex Servative, you can compare the effects of market volatilities on Astar and Fidelity Flex 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 Astar with a short position of Fidelity Flex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astar and Fidelity Flex.
Diversification Opportunities for Astar and Fidelity Flex
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Astar and Fidelity is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Astar and Fidelity Flex Servative in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Flex Servative and Astar 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 Astar are associated (or correlated) with Fidelity Flex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Flex Servative has no effect on the direction of Astar i.e., Astar and Fidelity Flex go up and down completely randomly.
Pair Corralation between Astar and Fidelity Flex
Assuming the 90 days trading horizon Astar is expected to under-perform the Fidelity Flex. In addition to that, Astar is 87.4 times more volatile than Fidelity Flex Servative. It trades about -0.16 of its total potential returns per unit of risk. Fidelity Flex Servative is currently generating about -0.08 per unit of volatility. If you would invest 1,004 in Fidelity Flex Servative on October 11, 2024 and sell it today you would lose (1.00) from holding Fidelity Flex Servative or give up 0.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Astar vs. Fidelity Flex Servative
Performance |
| Timeline |
| Astar |
| Fidelity Flex Servative |
Astar and Fidelity Flex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astar and Fidelity Flex
The main advantage of trading using opposite Astar and Fidelity Flex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astar position performs unexpectedly, Fidelity Flex 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 Flex will offset losses from the drop in Fidelity Flex's long position.The idea behind Astar and Fidelity Flex Servative 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.| Fidelity Flex vs. John Hancock Financial | Fidelity Flex vs. Fidelity Advisor Financial | Fidelity Flex vs. Davis Financial Fund | Fidelity Flex vs. Putnam Global Financials |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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