Correlation Between Fidelity Balanced and Old Westbury
Can any of the company-specific risk be diversified away by investing in both Fidelity Balanced and Old Westbury 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 Old Westbury 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 Old Westbury Fixed, you can compare the effects of market volatilities on Fidelity Balanced and Old Westbury 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 Old Westbury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Balanced and Old Westbury.
Diversification Opportunities for Fidelity Balanced and Old Westbury
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fidelity and Old is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Balanced Fund and Old Westbury Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Westbury Fixed 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 Old Westbury. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Westbury Fixed has no effect on the direction of Fidelity Balanced i.e., Fidelity Balanced and Old Westbury go up and down completely randomly.
Pair Corralation between Fidelity Balanced and Old Westbury
Assuming the 90 days horizon Fidelity Balanced Fund is expected to generate 2.75 times more return on investment than Old Westbury. However, Fidelity Balanced is 2.75 times more volatile than Old Westbury Fixed. It trades about 0.12 of its potential returns per unit of risk. Old Westbury Fixed is currently generating about -0.1 per unit of risk. If you would invest 2,976 in Fidelity Balanced Fund on August 24, 2024 and sell it today you would earn a total of 43.00 from holding Fidelity Balanced Fund or generate 1.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Fidelity Balanced Fund vs. Old Westbury Fixed
Performance |
| Timeline |
| Fidelity Balanced |
| Old Westbury Fixed |
Fidelity Balanced and Old Westbury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Balanced and Old Westbury
The main advantage of trading using opposite Fidelity Balanced and Old Westbury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Balanced position performs unexpectedly, Old Westbury 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 Old Westbury will offset losses from the drop in Old Westbury'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 |
| Old Westbury vs. Sp Midcap Index | Old Westbury vs. Ep Emerging Markets | Old Westbury vs. Pnc Emerging Markets | Old Westbury vs. Shelton 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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