Correlation Between Fidelity Puritan and Fidelity Salem
Can any of the company-specific risk be diversified away by investing in both Fidelity Puritan and Fidelity Salem 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 Salem 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 Salem Street, you can compare the effects of market volatilities on Fidelity Puritan and Fidelity Salem 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 Salem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Puritan and Fidelity Salem.
Diversification Opportunities for Fidelity Puritan and Fidelity Salem
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fidelity and Fidelity is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Puritan Fund and Fidelity Salem Street in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Salem Street 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 Salem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Salem Street has no effect on the direction of Fidelity Puritan i.e., Fidelity Puritan and Fidelity Salem go up and down completely randomly.
Pair Corralation between Fidelity Puritan and Fidelity Salem
Assuming the 90 days horizon Fidelity Puritan Fund is expected to generate 1.07 times more return on investment than Fidelity Salem. However, Fidelity Puritan is 1.07 times more volatile than Fidelity Salem Street. It trades about 0.0 of its potential returns per unit of risk. Fidelity Salem Street is currently generating about -0.02 per unit of risk. If you would invest 2,587 in Fidelity Puritan Fund on November 2, 2024 and sell it today you would lose (18.00) from holding Fidelity Puritan Fund or give up 0.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Puritan Fund vs. Fidelity Salem Street
Performance |
| Timeline |
| Fidelity Puritan |
| Fidelity Salem Street |
Fidelity Puritan and Fidelity Salem Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Puritan and Fidelity Salem
The main advantage of trading using opposite Fidelity Puritan and Fidelity Salem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Puritan position performs unexpectedly, Fidelity Salem 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 Salem will offset losses from the drop in Fidelity Salem's long position.| Fidelity Puritan vs. Fidelity Balanced Fund | Fidelity Puritan vs. Fidelity Magellan Fund | Fidelity Puritan vs. Fidelity Growth Income | Fidelity Puritan vs. Fidelity Equity Income Fund |
| Fidelity Salem vs. Rbc Ultra Short Fixed | Fidelity Salem vs. Multisector Bond Sma | Fidelity Salem vs. Blrc Sgy Mnp | Fidelity Salem vs. Dreyfusstandish Global Fixed |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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