Correlation Between Fidelity Puritan and Fidelity Stock
Can any of the company-specific risk be diversified away by investing in both Fidelity Puritan and Fidelity Stock 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 Puritan and Fidelity Stock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Puritan Fund and Fidelity Stock Selector, you can compare the effects of market volatilities on Fidelity Puritan and Fidelity Stock 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 Puritan with a short position of Fidelity Stock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Puritan and Fidelity Stock.
Diversification Opportunities for Fidelity Puritan and Fidelity Stock
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fidelity and FIDELITY is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Puritan Fund and Fidelity Stock Selector in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Stock Selector and Fidelity Puritan 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 Puritan Fund are associated (or correlated) with Fidelity Stock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Stock Selector has no effect on the direction of Fidelity Puritan i.e., Fidelity Puritan and Fidelity Stock go up and down completely randomly.
Pair Corralation between Fidelity Puritan and Fidelity Stock
Assuming the 90 days horizon Fidelity Puritan is expected to generate 2.65 times less return on investment than Fidelity Stock. But when comparing it to its historical volatility, Fidelity Puritan Fund is 1.24 times less risky than Fidelity Stock. It trades about 0.14 of its potential returns per unit of risk. Fidelity Stock Selector is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 2,823 in Fidelity Stock Selector on August 26, 2024 and sell it today you would earn a total of 141.00 from holding Fidelity Stock Selector or generate 4.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Puritan Fund vs. Fidelity Stock Selector
Performance |
| Timeline |
| Fidelity Puritan |
| Fidelity Stock Selector |
Fidelity Puritan and Fidelity Stock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Puritan and Fidelity Stock
The main advantage of trading using opposite Fidelity Puritan and Fidelity Stock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Puritan position performs unexpectedly, Fidelity Stock 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 Fidelity Stock will offset losses from the drop in Fidelity Stock's long position.| Fidelity Puritan vs. Fidelity Advisor Balanced | Fidelity Puritan vs. Fidelity Advisor Balanced | Fidelity Puritan vs. Fidelity Advisor Growth | Fidelity Puritan vs. Fidelity Advisor Equity |
| Fidelity Stock vs. Fidelity Freedom 2015 | Fidelity Stock vs. Fidelity Puritan Fund | Fidelity Stock vs. Fidelity Puritan Fund | Fidelity Stock vs. Fidelity Pennsylvania Municipal |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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