Correlation Between Baillie Gifford and Fidelity New
Can any of the company-specific risk be diversified away by investing in both Baillie Gifford and Fidelity New 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 Baillie Gifford and Fidelity New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baillie Gifford Health and Fidelity New Markets, you can compare the effects of market volatilities on Baillie Gifford and Fidelity New 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 Baillie Gifford with a short position of Fidelity New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baillie Gifford and Fidelity New.
Diversification Opportunities for Baillie Gifford and Fidelity New
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Baillie and Fidelity is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford Health and Fidelity New Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity New Markets and Baillie Gifford 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 Baillie Gifford Health are associated (or correlated) with Fidelity New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity New Markets has no effect on the direction of Baillie Gifford i.e., Baillie Gifford and Fidelity New go up and down completely randomly.
Pair Corralation between Baillie Gifford and Fidelity New
Assuming the 90 days horizon Baillie Gifford Health is expected to under-perform the Fidelity New. In addition to that, Baillie Gifford is 3.22 times more volatile than Fidelity New Markets. It trades about -0.02 of its total potential returns per unit of risk. Fidelity New Markets is currently generating about 0.1 per unit of volatility. If you would invest 1,058 in Fidelity New Markets on September 2, 2024 and sell it today you would earn a total of 229.00 from holding Fidelity New Markets or generate 21.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baillie Gifford Health vs. Fidelity New Markets
Performance |
| Timeline |
| Baillie Gifford Health |
| Fidelity New Markets |
Baillie Gifford and Fidelity New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baillie Gifford and Fidelity New
The main advantage of trading using opposite Baillie Gifford and Fidelity New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baillie Gifford position performs unexpectedly, Fidelity New 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 New will offset losses from the drop in Fidelity New's long position.| Baillie Gifford vs. The Eafe Pure | Baillie Gifford vs. The Long Term | Baillie Gifford vs. Baillie Gifford International | Baillie Gifford vs. Baillie Gifford International |
| Fidelity New vs. Fidelity Series 1000 | Fidelity New vs. Fundamental Large Cap | Fidelity New vs. Jhancock Disciplined Value | Fidelity New vs. John Hancock 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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