Correlation Between Fidelity Managed and Frost Kempner
Can any of the company-specific risk be diversified away by investing in both Fidelity Managed and Frost Kempner 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 Managed and Frost Kempner into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Managed Retirement and Frost Kempner Treasury, you can compare the effects of market volatilities on Fidelity Managed and Frost Kempner 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 Managed with a short position of Frost Kempner. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Managed and Frost Kempner.
Diversification Opportunities for Fidelity Managed and Frost Kempner
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fidelity and Frost is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Managed Retirement and Frost Kempner Treasury in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frost Kempner Treasury and Fidelity Managed 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 Managed Retirement are associated (or correlated) with Frost Kempner. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frost Kempner Treasury has no effect on the direction of Fidelity Managed i.e., Fidelity Managed and Frost Kempner go up and down completely randomly.
Pair Corralation between Fidelity Managed and Frost Kempner
Assuming the 90 days horizon Fidelity Managed Retirement is expected to generate 2.03 times more return on investment than Frost Kempner. However, Fidelity Managed is 2.03 times more volatile than Frost Kempner Treasury. It trades about 0.07 of its potential returns per unit of risk. Frost Kempner Treasury is currently generating about 0.12 per unit of risk. If you would invest 5,096 in Fidelity Managed Retirement on September 3, 2024 and sell it today you would earn a total of 587.00 from holding Fidelity Managed Retirement or generate 11.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Managed Retirement vs. Frost Kempner Treasury
Performance |
| Timeline |
| Fidelity Managed Ret |
| Frost Kempner Treasury |
Fidelity Managed and Frost Kempner Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Managed and Frost Kempner
The main advantage of trading using opposite Fidelity Managed and Frost Kempner positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Managed position performs unexpectedly, Frost Kempner 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 Frost Kempner will offset losses from the drop in Frost Kempner's long position.| Fidelity Managed vs. Vanguard Target Retirement | Fidelity Managed vs. Blackrock Lifepath Idx | Fidelity Managed vs. Jpmorgan Smartretirement Income | Fidelity Managed vs. Jpmorgan Smartretirement Income |
| Frost Kempner vs. SPACE | Frost Kempner vs. Bayview Acquisition Corp | Frost Kempner vs. Ampleforth | Frost Kempner vs. ionet |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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