Correlation Between Fidelity Puritan and New Alternatives
Can any of the company-specific risk be diversified away by investing in both Fidelity Puritan and New Alternatives 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 New Alternatives 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 New Alternatives Fund, you can compare the effects of market volatilities on Fidelity Puritan and New Alternatives 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 New Alternatives. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Puritan and New Alternatives.
Diversification Opportunities for Fidelity Puritan and New Alternatives
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fidelity and New is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Puritan Fund and New Alternatives Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Alternatives 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 New Alternatives. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Alternatives has no effect on the direction of Fidelity Puritan i.e., Fidelity Puritan and New Alternatives go up and down completely randomly.
Pair Corralation between Fidelity Puritan and New Alternatives
Assuming the 90 days horizon Fidelity Puritan Fund is expected to generate 0.59 times more return on investment than New Alternatives. However, Fidelity Puritan Fund is 1.71 times less risky than New Alternatives. It trades about 0.11 of its potential returns per unit of risk. New Alternatives Fund is currently generating about -0.01 per unit of risk. If you would invest 1,967 in Fidelity Puritan Fund on August 30, 2024 and sell it today you would earn a total of 599.00 from holding Fidelity Puritan Fund or generate 30.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Puritan Fund vs. New Alternatives Fund
Performance |
| Timeline |
| Fidelity Puritan |
| New Alternatives |
Fidelity Puritan and New Alternatives Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Puritan and New Alternatives
The main advantage of trading using opposite Fidelity Puritan and New Alternatives positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Puritan position performs unexpectedly, New Alternatives 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 New Alternatives will offset losses from the drop in New Alternatives' 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 |
| New Alternatives vs. Blackrock Sm Cap | New Alternatives vs. Delaware Limited Term Diversified | New Alternatives vs. T Rowe Price | New Alternatives vs. Tiaa Cref Small Cap Blend |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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