Correlation Between Fidelity Managed and Fidelity Flex
Can any of the company-specific risk be diversified away by investing in both Fidelity Managed and Fidelity Flex 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 Fidelity Flex 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 Fidelity Flex Municipal, you can compare the effects of market volatilities on Fidelity Managed and Fidelity Flex 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 Fidelity Flex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Managed and Fidelity Flex.
Diversification Opportunities for Fidelity Managed and Fidelity Flex
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fidelity and Fidelity is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Managed Retirement and Fidelity Flex Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Flex Municipal 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 Fidelity Flex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Flex Municipal has no effect on the direction of Fidelity Managed i.e., Fidelity Managed and Fidelity Flex go up and down completely randomly.
Pair Corralation between Fidelity Managed and Fidelity Flex
Assuming the 90 days horizon Fidelity Managed Retirement is expected to generate 1.37 times more return on investment than Fidelity Flex. However, Fidelity Managed is 1.37 times more volatile than Fidelity Flex Municipal. It trades about 0.11 of its potential returns per unit of risk. Fidelity Flex Municipal is currently generating about 0.13 per unit of risk. If you would invest 5,468 in Fidelity Managed Retirement on September 3, 2024 and sell it today you would earn a total of 215.00 from holding Fidelity Managed Retirement or generate 3.93% 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. Fidelity Flex Municipal
Performance |
| Timeline |
| Fidelity Managed Ret |
| Fidelity Flex Municipal |
Fidelity Managed and Fidelity Flex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Managed and Fidelity Flex
The main advantage of trading using opposite Fidelity Managed and Fidelity Flex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Managed position performs unexpectedly, Fidelity Flex 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 Flex will offset losses from the drop in Fidelity Flex'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 |
| Fidelity Flex vs. Fidelity Flex Small | Fidelity Flex vs. Fidelity Flex International | Fidelity Flex vs. Fidelity Flex Mid | Fidelity Flex vs. Fidelity Flex 500 |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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