Correlation Between Ashmore Emerging and Fidelity Advisor
Can any of the company-specific risk be diversified away by investing in both Ashmore Emerging and Fidelity Advisor 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 Ashmore Emerging and Fidelity Advisor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashmore Emerging Markets and Fidelity Advisor Freedom, you can compare the effects of market volatilities on Ashmore Emerging and Fidelity Advisor 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 Ashmore Emerging with a short position of Fidelity Advisor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashmore Emerging and Fidelity Advisor.
Diversification Opportunities for Ashmore Emerging and Fidelity Advisor
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ashmore and Fidelity is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Ashmore Emerging Markets and Fidelity Advisor Freedom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Freedom and Ashmore 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 Ashmore Emerging Markets are associated (or correlated) with Fidelity Advisor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Advisor Freedom has no effect on the direction of Ashmore Emerging i.e., Ashmore Emerging and Fidelity Advisor go up and down completely randomly.
Pair Corralation between Ashmore Emerging and Fidelity Advisor
Assuming the 90 days horizon Ashmore Emerging Markets is expected to generate 0.76 times more return on investment than Fidelity Advisor. However, Ashmore Emerging Markets is 1.31 times less risky than Fidelity Advisor. It trades about 0.22 of its potential returns per unit of risk. Fidelity Advisor Freedom is currently generating about 0.1 per unit of risk. If you would invest 515.00 in Ashmore Emerging Markets on September 12, 2024 and sell it today you would earn a total of 65.00 from holding Ashmore Emerging Markets or generate 12.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashmore Emerging Markets vs. Fidelity Advisor Freedom
Performance |
| Timeline |
| Ashmore Emerging Markets |
| Fidelity Advisor Freedom |
Ashmore Emerging and Fidelity Advisor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashmore Emerging and Fidelity Advisor
The main advantage of trading using opposite Ashmore Emerging and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashmore Emerging position performs unexpectedly, Fidelity Advisor 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 Advisor will offset losses from the drop in Fidelity Advisor's long position.| Ashmore Emerging vs. Fidelity New Markets | Ashmore Emerging vs. Fidelity New Markets | Ashmore Emerging vs. Fidelity New Markets | Ashmore Emerging vs. SCOR PK |
| Fidelity Advisor vs. Barings Emerging Markets | Fidelity Advisor vs. Ep Emerging Markets | Fidelity Advisor vs. Ashmore Emerging Markets | Fidelity Advisor vs. Investec Emerging Markets |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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