Correlation Between Fidelity Balanced and Keeley Small
Can any of the company-specific risk be diversified away by investing in both Fidelity Balanced and Keeley Small 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 Fidelity Balanced and Keeley Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Balanced Fund and Keeley Small Cap, you can compare the effects of market volatilities on Fidelity Balanced and Keeley Small 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 Fidelity Balanced with a short position of Keeley Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Balanced and Keeley Small.
Diversification Opportunities for Fidelity Balanced and Keeley Small
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Fidelity and Keeley is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Balanced Fund and Keeley Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Keeley Small Cap and Fidelity Balanced 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 Fidelity Balanced Fund are associated (or correlated) with Keeley Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Keeley Small Cap has no effect on the direction of Fidelity Balanced i.e., Fidelity Balanced and Keeley Small go up and down completely randomly.
Pair Corralation between Fidelity Balanced and Keeley Small
Assuming the 90 days horizon Fidelity Balanced is expected to generate 3.29 times less return on investment than Keeley Small. But when comparing it to its historical volatility, Fidelity Balanced Fund is 2.42 times less risky than Keeley Small. It trades about 0.2 of its potential returns per unit of risk. Keeley Small Cap is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 1,840 in Keeley Small Cap on August 29, 2024 and sell it today you would earn a total of 159.00 from holding Keeley Small Cap or generate 8.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Balanced Fund vs. Keeley Small Cap
Performance |
| Timeline |
| Fidelity Balanced |
| Keeley Small Cap |
Fidelity Balanced and Keeley Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Balanced and Keeley Small
The main advantage of trading using opposite Fidelity Balanced and Keeley Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Balanced position performs unexpectedly, Keeley Small 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 Keeley Small will offset losses from the drop in Keeley Small's long position.| Fidelity Balanced vs. Fidelity Puritan Fund | Fidelity Balanced vs. Fidelity Low Priced Stock | Fidelity Balanced vs. Fidelity International Discovery | Fidelity Balanced vs. Fidelity Contrafund |
| Keeley Small vs. Queens Road Small | Keeley Small vs. Applied Finance Explorer | Keeley Small vs. Amg River Road | Keeley Small vs. Pace Smallmedium Value |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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