Correlation Between Fidelity Focused and Intermediate-term
Can any of the company-specific risk be diversified away by investing in both Fidelity Focused and Intermediate-term 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 Focused and Intermediate-term into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Focused High and Intermediate Term Tax Free Bond, you can compare the effects of market volatilities on Fidelity Focused and Intermediate-term 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 Focused with a short position of Intermediate-term. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Focused and Intermediate-term.
Diversification Opportunities for Fidelity Focused and Intermediate-term
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fidelity and Intermediate-term is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Focused High and Intermediate Term Tax Free Bon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intermediate Term Tax and Fidelity Focused 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 Focused High are associated (or correlated) with Intermediate-term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intermediate Term Tax has no effect on the direction of Fidelity Focused i.e., Fidelity Focused and Intermediate-term go up and down completely randomly.
Pair Corralation between Fidelity Focused and Intermediate-term
Assuming the 90 days horizon Fidelity Focused High is expected to generate 1.27 times more return on investment than Intermediate-term. However, Fidelity Focused is 1.27 times more volatile than Intermediate Term Tax Free Bond. It trades about 0.28 of its potential returns per unit of risk. Intermediate Term Tax Free Bond is currently generating about 0.03 per unit of risk. If you would invest 805.00 in Fidelity Focused High on October 26, 2024 and sell it today you would earn a total of 9.00 from holding Fidelity Focused High or generate 1.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Focused High vs. Intermediate Term Tax Free Bon
Performance |
| Timeline |
| Fidelity Focused High |
| Intermediate Term Tax |
Fidelity Focused and Intermediate-term Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Focused and Intermediate-term
The main advantage of trading using opposite Fidelity Focused and Intermediate-term positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Focused position performs unexpectedly, Intermediate-term 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 Intermediate-term will offset losses from the drop in Intermediate-term's long position.| Fidelity Focused vs. Fidelity High Income | Fidelity Focused vs. Fidelity Advisor Mortgage | Fidelity Focused vs. Fidelity Advisor Floating | Fidelity Focused vs. Fidelity Total Bond |
| Intermediate-term vs. Prudential High Yield | Intermediate-term vs. Siit High Yield | Intermediate-term vs. Fidelity Focused High | Intermediate-term vs. Metropolitan West High |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |