Correlation Between Fidelity Series and Scharf Fund
Can any of the company-specific risk be diversified away by investing in both Fidelity Series and Scharf Fund 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 Scharf Fund 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 Scharf Fund Retail, you can compare the effects of market volatilities on Fidelity Series and Scharf Fund 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 Scharf Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Series and Scharf Fund.
Diversification Opportunities for Fidelity Series and Scharf Fund
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fidelity and Scharf is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Series 1000 and Scharf Fund Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scharf Fund Retail 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 Scharf Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scharf Fund Retail has no effect on the direction of Fidelity Series i.e., Fidelity Series and Scharf Fund go up and down completely randomly.
Pair Corralation between Fidelity Series and Scharf Fund
Assuming the 90 days horizon Fidelity Series 1000 is expected to generate 1.06 times more return on investment than Scharf Fund. However, Fidelity Series is 1.06 times more volatile than Scharf Fund Retail. It trades about -0.12 of its potential returns per unit of risk. Scharf Fund Retail is currently generating about -0.13 per unit of risk. If you would invest 1,774 in Fidelity Series 1000 on September 12, 2024 and sell it today you would lose (24.00) from holding Fidelity Series 1000 or give up 1.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Series 1000 vs. Scharf Fund Retail
Performance |
| Timeline |
| Fidelity Series 1000 |
| Scharf Fund Retail |
Fidelity Series and Scharf Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Series and Scharf Fund
The main advantage of trading using opposite Fidelity Series and Scharf Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Series position performs unexpectedly, Scharf Fund 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 Scharf Fund will offset losses from the drop in Scharf Fund'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 |
| Scharf Fund vs. Gmo Resources | Scharf Fund vs. Icon Natural Resources | Scharf Fund vs. Fidelity Advisor Energy | Scharf Fund vs. Oil Gas Ultrasector |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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