Correlation Between Fidelity Global and First Asset
Can any of the company-specific risk be diversified away by investing in both Fidelity Global and First Asset 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 Global and First Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Global Value and First Asset Energy, you can compare the effects of market volatilities on Fidelity Global and First Asset 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 Global with a short position of First Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Global and First Asset.
Diversification Opportunities for Fidelity Global and First Asset
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Fidelity and First is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Global Value and First Asset Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Asset Energy and Fidelity Global 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 Global Value are associated (or correlated) with First Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Asset Energy has no effect on the direction of Fidelity Global i.e., Fidelity Global and First Asset go up and down completely randomly.
Pair Corralation between Fidelity Global and First Asset
Assuming the 90 days trading horizon Fidelity Global Value is expected to under-perform the First Asset. In addition to that, Fidelity Global is 1.1 times more volatile than First Asset Energy. It trades about -0.08 of its total potential returns per unit of risk. First Asset Energy is currently generating about 0.02 per unit of volatility. If you would invest 526.00 in First Asset Energy on September 5, 2024 and sell it today you would earn a total of 53.00 from holding First Asset Energy or generate 10.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 42.42% |
| Values | Daily Returns |
Fidelity Global Value vs. First Asset Energy
Performance |
| Timeline |
| Fidelity Global Value |
| First Asset Energy |
Fidelity Global and First Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Global and First Asset
The main advantage of trading using opposite Fidelity Global and First Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Global position performs unexpectedly, First Asset 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 First Asset will offset losses from the drop in First Asset's long position.| Fidelity Global vs. First Asset Energy | Fidelity Global vs. First Asset Tech | Fidelity Global vs. Harvest Equal Weight | Fidelity Global vs. CI Canada Lifeco |
| First Asset vs. CI Gold Giants | First Asset vs. First Asset Tech | First Asset vs. CI Canada Lifeco | First Asset vs. Harvest Healthcare Leaders |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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