Correlation Between Fidelity Series and Multi Index
Can any of the company-specific risk be diversified away by investing in both Fidelity Series and Multi Index 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 Series and Multi Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Series 1000 and Multi Index 2030 Lifetime, you can compare the effects of market volatilities on Fidelity Series and Multi Index 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 Series with a short position of Multi Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Series and Multi Index.
Diversification Opportunities for Fidelity Series and Multi Index
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fidelity and Multi is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Series 1000 and Multi Index 2030 Lifetime in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Index 2030 and Fidelity Series 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 Series 1000 are associated (or correlated) with Multi Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Index 2030 has no effect on the direction of Fidelity Series i.e., Fidelity Series and Multi Index go up and down completely randomly.
Pair Corralation between Fidelity Series and Multi Index
Assuming the 90 days horizon Fidelity Series 1000 is expected to under-perform the Multi Index. In addition to that, Fidelity Series is 1.51 times more volatile than Multi Index 2030 Lifetime. It trades about -0.12 of its total potential returns per unit of risk. Multi Index 2030 Lifetime is currently generating about 0.04 per unit of volatility. If you would invest 1,276 in Multi Index 2030 Lifetime on September 12, 2024 and sell it today you would earn a total of 4.00 from holding Multi Index 2030 Lifetime or generate 0.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Fidelity Series 1000 vs. Multi Index 2030 Lifetime
Performance |
| Timeline |
| Fidelity Series 1000 |
| Multi Index 2030 |
Fidelity Series and Multi Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Series and Multi Index
The main advantage of trading using opposite Fidelity Series and Multi Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Series position performs unexpectedly, Multi Index 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 Multi Index will offset losses from the drop in Multi Index's long position.| Fidelity Series vs. Vanguard Value Index | Fidelity Series vs. Dodge Cox Stock | Fidelity Series vs. American Mutual Fund | Fidelity Series vs. American Funds American |
| Multi Index vs. Vanguard Target Retirement | Multi Index vs. Fidelity Freedom 2030 | Multi Index vs. HUMANA INC | Multi Index vs. Barloworld Ltd ADR |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |