Correlation Between Fidelity Managed and Multimanager Lifestyle
Can any of the company-specific risk be diversified away by investing in both Fidelity Managed and Multimanager Lifestyle 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 Managed and Multimanager Lifestyle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Managed Retirement and Multimanager Lifestyle Moderate, you can compare the effects of market volatilities on Fidelity Managed and Multimanager Lifestyle 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 Managed with a short position of Multimanager Lifestyle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Managed and Multimanager Lifestyle.
Diversification Opportunities for Fidelity Managed and Multimanager Lifestyle
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Fidelity and MULTIMANAGER is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Managed Retirement and Multimanager Lifestyle Moderat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multimanager Lifestyle and Fidelity Managed 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 Managed Retirement are associated (or correlated) with Multimanager Lifestyle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multimanager Lifestyle has no effect on the direction of Fidelity Managed i.e., Fidelity Managed and Multimanager Lifestyle go up and down completely randomly.
Pair Corralation between Fidelity Managed and Multimanager Lifestyle
Assuming the 90 days horizon Fidelity Managed is expected to generate 1.7 times less return on investment than Multimanager Lifestyle. In addition to that, Fidelity Managed is 1.12 times more volatile than Multimanager Lifestyle Moderate. It trades about 0.1 of its total potential returns per unit of risk. Multimanager Lifestyle Moderate is currently generating about 0.19 per unit of volatility. If you would invest 1,251 in Multimanager Lifestyle Moderate on August 31, 2024 and sell it today you would earn a total of 17.00 from holding Multimanager Lifestyle Moderate or generate 1.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Managed Retirement vs. Multimanager Lifestyle Moderat
Performance |
| Timeline |
| Fidelity Managed Ret |
| Multimanager Lifestyle |
Fidelity Managed and Multimanager Lifestyle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Managed and Multimanager Lifestyle
The main advantage of trading using opposite Fidelity Managed and Multimanager Lifestyle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Managed position performs unexpectedly, Multimanager Lifestyle 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 Multimanager Lifestyle will offset losses from the drop in Multimanager Lifestyle's long position.| Fidelity Managed vs. Federated Ohio Municipal | Fidelity Managed vs. Nuveen Minnesota Municipal | Fidelity Managed vs. Pace Municipal Fixed | Fidelity Managed vs. Alliancebernstein National Municipal |
| Multimanager Lifestyle vs. Westwood Income Opportunity | Multimanager Lifestyle vs. First Eagle Global | Multimanager Lifestyle vs. Berwyn Income Fund | Multimanager Lifestyle vs. Fpa Crescent Fund |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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