Correlation Between Fidelity High and BMO MSCI
Can any of the company-specific risk be diversified away by investing in both Fidelity High and BMO MSCI 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 High and BMO MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity High Dividend and BMO MSCI EAFE, you can compare the effects of market volatilities on Fidelity High and BMO MSCI 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 High with a short position of BMO MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity High and BMO MSCI.
Diversification Opportunities for Fidelity High and BMO MSCI
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Fidelity and BMO is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity High Dividend and BMO MSCI EAFE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BMO MSCI EAFE and Fidelity High 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 High Dividend are associated (or correlated) with BMO MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BMO MSCI EAFE has no effect on the direction of Fidelity High i.e., Fidelity High and BMO MSCI go up and down completely randomly.
Pair Corralation between Fidelity High and BMO MSCI
Assuming the 90 days trading horizon Fidelity High Dividend is expected to under-perform the BMO MSCI. But the etf apears to be less risky and, when comparing its historical volatility, Fidelity High Dividend is 1.51 times less risky than BMO MSCI. The etf trades about -0.09 of its potential returns per unit of risk. The BMO MSCI EAFE is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 2,319 in BMO MSCI EAFE on September 12, 2024 and sell it today you would earn a total of 42.00 from holding BMO MSCI EAFE or generate 1.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity High Dividend vs. BMO MSCI EAFE
Performance |
| Timeline |
| Fidelity High Dividend |
| BMO MSCI EAFE |
Fidelity High and BMO MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity High and BMO MSCI
The main advantage of trading using opposite Fidelity High and BMO MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity High position performs unexpectedly, BMO MSCI 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 BMO MSCI will offset losses from the drop in BMO MSCI's long position.| Fidelity High vs. Vanguard Dividend Appreciation | Fidelity High vs. Vanguard Total Market | Fidelity High vs. Vanguard FTSE Developed | Fidelity High vs. Vanguard FTSE Developed |
| BMO MSCI vs. Mackenzie Canadian Equity | BMO MSCI vs. BMO MSCI Emerging | BMO MSCI vs. Mackenzie Large Cap | BMO MSCI vs. BMO Long Federal |
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
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |