Correlation Between Fidelity China and Liberty All
Can any of the company-specific risk be diversified away by investing in both Fidelity China and Liberty All 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 China and Liberty All into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity China Region and Liberty All Star, you can compare the effects of market volatilities on Fidelity China and Liberty All 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 China with a short position of Liberty All. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity China and Liberty All.
Diversification Opportunities for Fidelity China and Liberty All
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fidelity and Liberty is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity China Region and Liberty All Star in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liberty All Star and Fidelity China 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 China Region are associated (or correlated) with Liberty All. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liberty All Star has no effect on the direction of Fidelity China i.e., Fidelity China and Liberty All go up and down completely randomly.
Pair Corralation between Fidelity China and Liberty All
Assuming the 90 days horizon Fidelity China Region is expected to under-perform the Liberty All. In addition to that, Fidelity China is 1.61 times more volatile than Liberty All Star. It trades about -0.19 of its total potential returns per unit of risk. Liberty All Star is currently generating about 0.21 per unit of volatility. If you would invest 699.00 in Liberty All Star on August 30, 2024 and sell it today you would earn a total of 29.00 from holding Liberty All Star or generate 4.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity China Region vs. Liberty All Star
Performance |
| Timeline |
| Fidelity China Region |
| Liberty All Star |
Fidelity China and Liberty All Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity China and Liberty All
The main advantage of trading using opposite Fidelity China and Liberty All positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity China position performs unexpectedly, Liberty All 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 Liberty All will offset losses from the drop in Liberty All's long position.| Fidelity China vs. Fidelity Emerging Asia | Fidelity China vs. Fidelity Emerging Markets | Fidelity China vs. Fidelity Canada Fund | Fidelity China vs. Fidelity Pacific Basin |
| Liberty All vs. Adams Diversified Equity | Liberty All vs. BlackRock Science and | Liberty All vs. Virtus Allianzgi Artificial | Liberty All vs. Royce Value Closed |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |