Correlation Between Fidelity Puritan and Fidelity Intermediate
Can any of the company-specific risk be diversified away by investing in both Fidelity Puritan and Fidelity Intermediate 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 Intermediate 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 Intermediate Bond, you can compare the effects of market volatilities on Fidelity Puritan and Fidelity Intermediate 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 Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Puritan and Fidelity Intermediate.
Diversification Opportunities for Fidelity Puritan and Fidelity Intermediate
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fidelity and FIDELITY is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Puritan Fund and Fidelity Intermediate Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Intermediate 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 Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Intermediate has no effect on the direction of Fidelity Puritan i.e., Fidelity Puritan and Fidelity Intermediate go up and down completely randomly.
Pair Corralation between Fidelity Puritan and Fidelity Intermediate
Assuming the 90 days horizon Fidelity Puritan Fund is expected to generate 2.37 times more return on investment than Fidelity Intermediate. However, Fidelity Puritan is 2.37 times more volatile than Fidelity Intermediate Bond. It trades about 0.1 of its potential returns per unit of risk. Fidelity Intermediate Bond is currently generating about 0.06 per unit of risk. If you would invest 1,898 in Fidelity Puritan Fund on September 3, 2024 and sell it today you would earn a total of 683.00 from holding Fidelity Puritan Fund or generate 35.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Puritan Fund vs. Fidelity Intermediate Bond
Performance |
| Timeline |
| Fidelity Puritan |
| Fidelity Intermediate |
Fidelity Puritan and Fidelity Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Puritan and Fidelity Intermediate
The main advantage of trading using opposite Fidelity Puritan and Fidelity Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Puritan position performs unexpectedly, Fidelity Intermediate 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 Intermediate will offset losses from the drop in Fidelity Intermediate's long position.| Fidelity Puritan vs. Alliancebernstein Global High | Fidelity Puritan vs. Ab Global Real | Fidelity Puritan vs. Commonwealth Global Fund | Fidelity Puritan vs. Ab Global Bond |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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