Correlation Between Capital Group and Fidelity Sustainable
Can any of the company-specific risk be diversified away by investing in both Capital Group and Fidelity Sustainable 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 Capital Group and Fidelity Sustainable into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital Group Core and Fidelity Sustainable Core, you can compare the effects of market volatilities on Capital Group and Fidelity Sustainable 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 Capital Group with a short position of Fidelity Sustainable. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Group and Fidelity Sustainable.
Diversification Opportunities for Capital Group and Fidelity Sustainable
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Capital and Fidelity is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Capital Group Core and Fidelity Sustainable Core in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Sustainable Core and Capital Group 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 Capital Group Core are associated (or correlated) with Fidelity Sustainable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Sustainable Core has no effect on the direction of Capital Group i.e., Capital Group and Fidelity Sustainable go up and down completely randomly.
Pair Corralation between Capital Group and Fidelity Sustainable
Given the investment horizon of 90 days Capital Group Core is expected to generate 1.01 times more return on investment than Fidelity Sustainable. However, Capital Group is 1.01 times more volatile than Fidelity Sustainable Core. It trades about 0.03 of its potential returns per unit of risk. Fidelity Sustainable Core is currently generating about 0.03 per unit of risk. If you would invest 2,079 in Capital Group Core on October 7, 2024 and sell it today you would earn a total of 139.00 from holding Capital Group Core or generate 6.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capital Group Core vs. Fidelity Sustainable Core
Performance |
| Timeline |
| Capital Group Core |
| Fidelity Sustainable Core |
Capital Group and Fidelity Sustainable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Group and Fidelity Sustainable
The main advantage of trading using opposite Capital Group and Fidelity Sustainable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Group position performs unexpectedly, Fidelity Sustainable 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 Sustainable will offset losses from the drop in Fidelity Sustainable's long position.| Capital Group vs. Capital Group Dividend | Capital Group vs. Capital Group Core | Capital Group vs. Capital Group Growth | Capital Group vs. Capital Group Global |
| Fidelity Sustainable vs. Fidelity Sustainable Low | Fidelity Sustainable vs. Fidelity Investment Grade | Fidelity Sustainable vs. Fidelity Investment Grade | Fidelity Sustainable vs. Fidelity Sustainable 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 CEOs Directory module to screen CEOs from public companies around the world.
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