Correlation Between Aggressive Growth and Fidelity Worldwide
Can any of the company-specific risk be diversified away by investing in both Aggressive Growth and Fidelity Worldwide 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 Aggressive Growth and Fidelity Worldwide into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aggressive Growth Allocation and Fidelity Worldwide Fund, you can compare the effects of market volatilities on Aggressive Growth and Fidelity Worldwide 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 Aggressive Growth with a short position of Fidelity Worldwide. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aggressive Growth and Fidelity Worldwide.
Diversification Opportunities for Aggressive Growth and Fidelity Worldwide
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aggressive and Fidelity is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Aggressive Growth Allocation and Fidelity Worldwide Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Worldwide and Aggressive Growth 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 Aggressive Growth Allocation are associated (or correlated) with Fidelity Worldwide. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Worldwide has no effect on the direction of Aggressive Growth i.e., Aggressive Growth and Fidelity Worldwide go up and down completely randomly.
Pair Corralation between Aggressive Growth and Fidelity Worldwide
Assuming the 90 days horizon Aggressive Growth Allocation is expected to generate 0.63 times more return on investment than Fidelity Worldwide. However, Aggressive Growth Allocation is 1.58 times less risky than Fidelity Worldwide. It trades about 0.13 of its potential returns per unit of risk. Fidelity Worldwide Fund is currently generating about 0.08 per unit of risk. If you would invest 1,146 in Aggressive Growth Allocation on August 30, 2024 and sell it today you would earn a total of 20.00 from holding Aggressive Growth Allocation or generate 1.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aggressive Growth Allocation vs. Fidelity Worldwide Fund
Performance |
| Timeline |
| Aggressive Growth |
| Fidelity Worldwide |
Aggressive Growth and Fidelity Worldwide Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aggressive Growth and Fidelity Worldwide
The main advantage of trading using opposite Aggressive Growth and Fidelity Worldwide positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aggressive Growth position performs unexpectedly, Fidelity Worldwide 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 Worldwide will offset losses from the drop in Fidelity Worldwide's long position.| Aggressive Growth vs. Mesirow Financial Small | Aggressive Growth vs. Prudential Jennison Financial | Aggressive Growth vs. Hennessy Large Cap | Aggressive Growth vs. Financials Ultrasector Profund |
| Fidelity Worldwide vs. Fidelity Pacific Basin | Fidelity Worldwide vs. Fidelity Europe Fund | Fidelity Worldwide vs. Fidelity International Capital | Fidelity Worldwide vs. Fidelity Overseas 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |