Correlation Between Fidelity Series and Touchstone Mid
Can any of the company-specific risk be diversified away by investing in both Fidelity Series and Touchstone Mid 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 Touchstone Mid 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 Touchstone Mid Cap, you can compare the effects of market volatilities on Fidelity Series and Touchstone Mid 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 Touchstone Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Series and Touchstone Mid.
Diversification Opportunities for Fidelity Series and Touchstone Mid
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fidelity and Touchstone is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Series 1000 and Touchstone Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Mid Cap 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 Touchstone Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Mid Cap has no effect on the direction of Fidelity Series i.e., Fidelity Series and Touchstone Mid go up and down completely randomly.
Pair Corralation between Fidelity Series and Touchstone Mid
Assuming the 90 days horizon Fidelity Series 1000 is expected to generate 0.74 times more return on investment than Touchstone Mid. However, Fidelity Series 1000 is 1.35 times less risky than Touchstone Mid. It trades about 0.11 of its potential returns per unit of risk. Touchstone Mid Cap is currently generating about 0.08 per unit of risk. If you would invest 1,376 in Fidelity Series 1000 on September 12, 2024 and sell it today you would earn a total of 374.00 from holding Fidelity Series 1000 or generate 27.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Series 1000 vs. Touchstone Mid Cap
Performance |
| Timeline |
| Fidelity Series 1000 |
| Touchstone Mid Cap |
Fidelity Series and Touchstone Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Series and Touchstone Mid
The main advantage of trading using opposite Fidelity Series and Touchstone Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Series position performs unexpectedly, Touchstone Mid 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 Touchstone Mid will offset losses from the drop in Touchstone Mid'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 |
| Touchstone Mid vs. Qs Large Cap | Touchstone Mid vs. Fidelity Series 1000 | Touchstone Mid vs. Jhancock Disciplined Value | Touchstone Mid vs. Aqr Large Cap |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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