Correlation Between Fidelity National and Maiden Holdings
Can any of the company-specific risk be diversified away by investing in both Fidelity National and Maiden Holdings 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 National and Maiden Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity National Information and Maiden Holdings North, you can compare the effects of market volatilities on Fidelity National and Maiden Holdings 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 National with a short position of Maiden Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity National and Maiden Holdings.
Diversification Opportunities for Fidelity National and Maiden Holdings
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fidelity and Maiden is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity National Information and Maiden Holdings North in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maiden Holdings North and Fidelity National 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 National Information are associated (or correlated) with Maiden Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maiden Holdings North has no effect on the direction of Fidelity National i.e., Fidelity National and Maiden Holdings go up and down completely randomly.
Pair Corralation between Fidelity National and Maiden Holdings
Considering the 90-day investment horizon Fidelity National Information is expected to generate 0.72 times more return on investment than Maiden Holdings. However, Fidelity National Information is 1.39 times less risky than Maiden Holdings. It trades about -0.21 of its potential returns per unit of risk. Maiden Holdings North is currently generating about -0.24 per unit of risk. If you would invest 9,072 in Fidelity National Information on August 31, 2024 and sell it today you would lose (517.00) from holding Fidelity National Information or give up 5.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity National Information vs. Maiden Holdings North
Performance |
| Timeline |
| Fidelity National |
| Maiden Holdings North |
Fidelity National and Maiden Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity National and Maiden Holdings
The main advantage of trading using opposite Fidelity National and Maiden Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity National position performs unexpectedly, Maiden Holdings 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 Maiden Holdings will offset losses from the drop in Maiden Holdings' long position.| Fidelity National vs. Jack Henry Associates | Fidelity National vs. Cognizant Technology Solutions | Fidelity National vs. CDW Corp | Fidelity National vs. Gartner |
| Maiden Holdings vs. Maiden Holdings | Maiden Holdings vs. Affiliated Managers Group | Maiden Holdings vs. Entergy New Orleans | Maiden Holdings vs. American Financial Group |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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