Correlation Between Fidelity Salem and Sp 500
Can any of the company-specific risk be diversified away by investing in both Fidelity Salem and Sp 500 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 Sp 500 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 Sp 500 Equal, you can compare the effects of market volatilities on Fidelity Salem and Sp 500 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 Sp 500. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Salem and Sp 500.
Diversification Opportunities for Fidelity Salem and Sp 500
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fidelity and INDEX is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Salem Street and Sp 500 Equal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sp 500 Equal 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 Sp 500. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sp 500 Equal has no effect on the direction of Fidelity Salem i.e., Fidelity Salem and Sp 500 go up and down completely randomly.
Pair Corralation between Fidelity Salem and Sp 500
Assuming the 90 days horizon Fidelity Salem Street is expected to under-perform the Sp 500. But the mutual fund apears to be less risky and, when comparing its historical volatility, Fidelity Salem Street is 1.0 times less risky than Sp 500. The mutual fund trades about -0.25 of its potential returns per unit of risk. The Sp 500 Equal is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 5,559 in Sp 500 Equal on August 29, 2024 and sell it today you would earn a total of 193.00 from holding Sp 500 Equal or generate 3.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Fidelity Salem Street vs. Sp 500 Equal
Performance |
| Timeline |
| Fidelity Salem Street |
| Sp 500 Equal |
Fidelity Salem and Sp 500 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Salem and Sp 500
The main advantage of trading using opposite Fidelity Salem and Sp 500 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Salem position performs unexpectedly, Sp 500 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 Sp 500 will offset losses from the drop in Sp 500's long position.| Fidelity Salem vs. Balanced Fund Investor | Fidelity Salem vs. Western Asset Municipal | Fidelity Salem vs. Falcon Focus Scv | Fidelity Salem vs. Abr 7525 Volatility |
| Sp 500 vs. Europac Gold Fund | Sp 500 vs. Fidelity Advisor Gold | Sp 500 vs. James Balanced Golden | Sp 500 vs. Global Gold Fund |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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