Correlation Between Fidelity New and Wellington Shields
Can any of the company-specific risk be diversified away by investing in both Fidelity New and Wellington Shields 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 New and Wellington Shields into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity New Markets and Wellington Shields All Cap, you can compare the effects of market volatilities on Fidelity New and Wellington Shields 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 New with a short position of Wellington Shields. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity New and Wellington Shields.
Diversification Opportunities for Fidelity New and Wellington Shields
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Fidelity and Wellington is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity New Markets and Wellington Shields All Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wellington Shields All and Fidelity New 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 New Markets are associated (or correlated) with Wellington Shields. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wellington Shields All has no effect on the direction of Fidelity New i.e., Fidelity New and Wellington Shields go up and down completely randomly.
Pair Corralation between Fidelity New and Wellington Shields
Assuming the 90 days horizon Fidelity New Markets is expected to generate 0.19 times more return on investment than Wellington Shields. However, Fidelity New Markets is 5.26 times less risky than Wellington Shields. It trades about -0.42 of its potential returns per unit of risk. Wellington Shields All Cap is currently generating about -0.16 per unit of risk. If you would invest 1,300 in Fidelity New Markets on October 9, 2024 and sell it today you would lose (29.00) from holding Fidelity New Markets or give up 2.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity New Markets vs. Wellington Shields All Cap
Performance |
| Timeline |
| Fidelity New Markets |
| Wellington Shields All |
Fidelity New and Wellington Shields Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity New and Wellington Shields
The main advantage of trading using opposite Fidelity New and Wellington Shields positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity New position performs unexpectedly, Wellington Shields 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 Wellington Shields will offset losses from the drop in Wellington Shields' long position.| Fidelity New vs. Hennessy Bp Energy | Fidelity New vs. Thrivent Natural Resources | Fidelity New vs. Firsthand Alternative Energy | Fidelity New vs. Transamerica Mlp Energy |
| Wellington Shields vs. Fidelity Otc Portfolio | Wellington Shields vs. Alger Smidcap Focus | Wellington Shields vs. Jpmorgan Strategic Income | Wellington Shields vs. Cleartrack 2020 Class |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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