Correlation Between Fidelity Contrafund and Gotham Enhanced
Can any of the company-specific risk be diversified away by investing in both Fidelity Contrafund and Gotham Enhanced 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 Gotham Enhanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Contrafund and Gotham Enhanced Sp, you can compare the effects of market volatilities on Fidelity Contrafund and Gotham Enhanced 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 Gotham Enhanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Contrafund and Gotham Enhanced.
Diversification Opportunities for Fidelity Contrafund and Gotham Enhanced
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Fidelity and Gotham is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Contrafund and Gotham Enhanced Sp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gotham Enhanced Sp 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 Gotham Enhanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gotham Enhanced Sp has no effect on the direction of Fidelity Contrafund i.e., Fidelity Contrafund and Gotham Enhanced go up and down completely randomly.
Pair Corralation between Fidelity Contrafund and Gotham Enhanced
Assuming the 90 days horizon Fidelity Contrafund is expected to under-perform the Gotham Enhanced. In addition to that, Fidelity Contrafund is 1.39 times more volatile than Gotham Enhanced Sp. It trades about -0.04 of its total potential returns per unit of risk. Gotham Enhanced Sp is currently generating about -0.05 per unit of volatility. If you would invest 1,831 in Gotham Enhanced Sp on November 28, 2024 and sell it today you would lose (12.00) from holding Gotham Enhanced Sp or give up 0.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Contrafund vs. Gotham Enhanced Sp
Performance |
| Timeline |
| Fidelity Contrafund |
| Gotham Enhanced Sp |
Fidelity Contrafund and Gotham Enhanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Contrafund and Gotham Enhanced
The main advantage of trading using opposite Fidelity Contrafund and Gotham Enhanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Contrafund position performs unexpectedly, Gotham Enhanced 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 Gotham Enhanced will offset losses from the drop in Gotham Enhanced's long position.| Fidelity Contrafund vs. Fidelity Low Priced Stock | Fidelity Contrafund vs. Fidelity Growth Pany | Fidelity Contrafund vs. Fidelity Magellan Fund | Fidelity Contrafund vs. Fidelity Diversified International |
| Gotham Enhanced vs. Prudential Real Estate | Gotham Enhanced vs. Real Estate Ultrasector | Gotham Enhanced vs. Vy Clarion Real | Gotham Enhanced vs. Forum Real Estate |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |