Correlation Between Fidelity Salem and Fidelity Series
Can any of the company-specific risk be diversified away by investing in both Fidelity Salem and Fidelity Series 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 Salem and Fidelity Series into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Salem Street and Fidelity Series Growth, you can compare the effects of market volatilities on Fidelity Salem and Fidelity Series 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 Salem with a short position of Fidelity Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Salem and Fidelity Series.
Diversification Opportunities for Fidelity Salem and Fidelity Series
-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 Salem Street and Fidelity Series Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Series Growth and Fidelity Salem 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 Salem Street are associated (or correlated) with Fidelity Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Series Growth has no effect on the direction of Fidelity Salem i.e., Fidelity Salem and Fidelity Series go up and down completely randomly.
Pair Corralation between Fidelity Salem and Fidelity Series
Assuming the 90 days horizon Fidelity Salem Street is expected to under-perform the Fidelity Series. But the mutual fund apears to be less risky and, when comparing its historical volatility, Fidelity Salem Street is 1.04 times less risky than Fidelity Series. The mutual fund trades about -0.31 of its potential returns per unit of risk. The Fidelity Series Growth is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 2,338 in Fidelity Series Growth on August 27, 2024 and sell it today you would earn a total of 90.00 from holding Fidelity Series Growth or generate 3.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Salem Street vs. Fidelity Series Growth
Performance |
| Timeline |
| Fidelity Salem Street |
| Fidelity Series Growth |
Fidelity Salem and Fidelity Series Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Salem and Fidelity Series
The main advantage of trading using opposite Fidelity Salem and Fidelity Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Salem position performs unexpectedly, Fidelity Series 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 Series will offset losses from the drop in Fidelity Series' long position.| Fidelity Salem vs. Fidelity Total International | Fidelity Salem vs. Fidelity Mega Cap | Fidelity Salem vs. Fidelity International Value |
| Fidelity Series vs. Fidelity Extended Market | Fidelity Series vs. Fidelity Small Cap | Fidelity Series vs. Fidelity Nasdaq Posite |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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