Correlation Between Fidelity High and Ocean Park
Can any of the company-specific risk be diversified away by investing in both Fidelity High and Ocean Park 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 Ocean Park into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity High Yield and Ocean Park High, you can compare the effects of market volatilities on Fidelity High and Ocean Park 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 Ocean Park. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity High and Ocean Park.
Diversification Opportunities for Fidelity High and Ocean Park
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Fidelity and Ocean is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity High Yield and Ocean Park High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocean Park High 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 Yield are associated (or correlated) with Ocean Park. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocean Park High has no effect on the direction of Fidelity High i.e., Fidelity High and Ocean Park go up and down completely randomly.
Pair Corralation between Fidelity High and Ocean Park
Given the investment horizon of 90 days Fidelity High Yield is expected to generate 0.96 times more return on investment than Ocean Park. However, Fidelity High Yield is 1.04 times less risky than Ocean Park. It trades about 0.16 of its potential returns per unit of risk. Ocean Park High is currently generating about 0.07 per unit of risk. If you would invest 4,867 in Fidelity High Yield on August 29, 2024 and sell it today you would earn a total of 37.00 from holding Fidelity High Yield or generate 0.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity High Yield vs. Ocean Park High
Performance |
| Timeline |
| Fidelity High Yield |
| Ocean Park High |
Fidelity High and Ocean Park Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity High and Ocean Park
The main advantage of trading using opposite Fidelity High and Ocean Park positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity High position performs unexpectedly, Ocean Park 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 Ocean Park will offset losses from the drop in Ocean Park's long position.| Fidelity High vs. Fidelity Corporate Bond | Fidelity High vs. Fidelity Total Bond | Fidelity High vs. Fidelity Dividend ETF | Fidelity High vs. Fidelity Limited Term |
| Ocean Park vs. iShares JP Morgan | Ocean Park vs. Fidelity High Yield | Ocean Park vs. Federated Hermes ETF | Ocean Park vs. SPDR SSGA Fixed |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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