Correlation Between Fidelity Contrafund and Stadion Tactical
Can any of the company-specific risk be diversified away by investing in both Fidelity Contrafund and Stadion Tactical 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 Contrafund and Stadion Tactical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Contrafund and Stadion Tactical Growth, you can compare the effects of market volatilities on Fidelity Contrafund and Stadion Tactical 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 Contrafund with a short position of Stadion Tactical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Contrafund and Stadion Tactical.
Diversification Opportunities for Fidelity Contrafund and Stadion Tactical
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fidelity and Stadion is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Contrafund and Stadion Tactical Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stadion Tactical Growth and Fidelity Contrafund 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 Contrafund are associated (or correlated) with Stadion Tactical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stadion Tactical Growth has no effect on the direction of Fidelity Contrafund i.e., Fidelity Contrafund and Stadion Tactical go up and down completely randomly.
Pair Corralation between Fidelity Contrafund and Stadion Tactical
Assuming the 90 days horizon Fidelity Contrafund is expected to generate 1.44 times more return on investment than Stadion Tactical. However, Fidelity Contrafund is 1.44 times more volatile than Stadion Tactical Growth. It trades about 0.1 of its potential returns per unit of risk. Stadion Tactical Growth is currently generating about 0.08 per unit of risk. If you would invest 1,844 in Fidelity Contrafund on August 27, 2024 and sell it today you would earn a total of 337.00 from holding Fidelity Contrafund or generate 18.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Contrafund vs. Stadion Tactical Growth
Performance |
| Timeline |
| Fidelity Contrafund |
| Stadion Tactical Growth |
Fidelity Contrafund and Stadion Tactical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Contrafund and Stadion Tactical
The main advantage of trading using opposite Fidelity Contrafund and Stadion Tactical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Contrafund position performs unexpectedly, Stadion Tactical 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 Stadion Tactical will offset losses from the drop in Stadion Tactical's long position.| Fidelity Contrafund vs. Lord Abbett Growth | Fidelity Contrafund vs. Fidelity Advisor Growth | Fidelity Contrafund vs. Aquagold International | Fidelity Contrafund vs. Morningstar Unconstrained Allocation |
| Stadion Tactical vs. Artisan High Income | Stadion Tactical vs. Siit High Yield | Stadion Tactical vs. Ab High Income | Stadion Tactical vs. Morningstar Aggressive Growth |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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