Correlation Between Fidelity Freedom and Wesmark Tactical
Can any of the company-specific risk be diversified away by investing in both Fidelity Freedom and Wesmark 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 Freedom and Wesmark Tactical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Freedom Blend and Wesmark Tactical Opportunity, you can compare the effects of market volatilities on Fidelity Freedom and Wesmark 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 Freedom with a short position of Wesmark Tactical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Freedom and Wesmark Tactical.
Diversification Opportunities for Fidelity Freedom and Wesmark Tactical
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fidelity and Wesmark is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Freedom Blend and Wesmark Tactical Opportunity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wesmark Tactical Opp and Fidelity Freedom 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 Freedom Blend are associated (or correlated) with Wesmark Tactical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wesmark Tactical Opp has no effect on the direction of Fidelity Freedom i.e., Fidelity Freedom and Wesmark Tactical go up and down completely randomly.
Pair Corralation between Fidelity Freedom and Wesmark Tactical
Assuming the 90 days horizon Fidelity Freedom is expected to generate 1.49 times less return on investment than Wesmark Tactical. In addition to that, Fidelity Freedom is 1.44 times more volatile than Wesmark Tactical Opportunity. It trades about 0.09 of its total potential returns per unit of risk. Wesmark Tactical Opportunity is currently generating about 0.18 per unit of volatility. If you would invest 1,183 in Wesmark Tactical Opportunity on August 30, 2024 and sell it today you would earn a total of 21.00 from holding Wesmark Tactical Opportunity or generate 1.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Freedom Blend vs. Wesmark Tactical Opportunity
Performance |
| Timeline |
| Fidelity Freedom Blend |
| Wesmark Tactical Opp |
Fidelity Freedom and Wesmark Tactical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Freedom and Wesmark Tactical
The main advantage of trading using opposite Fidelity Freedom and Wesmark Tactical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Freedom position performs unexpectedly, Wesmark 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 Wesmark Tactical will offset losses from the drop in Wesmark Tactical's long position.| Fidelity Freedom vs. Victory Global Natural | Fidelity Freedom vs. Ivy Natural Resources | Fidelity Freedom vs. Tortoise Energy Independence | Fidelity Freedom vs. Short Oil Gas |
| Wesmark Tactical vs. Wesmark Growth Fund | Wesmark Tactical vs. Wesmark Government Bond | Wesmark Tactical vs. Wesmark Small Pany |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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