Correlation Between Fidelity Income and Nasdaq 100
Can any of the company-specific risk be diversified away by investing in both Fidelity Income and Nasdaq 100 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 Income and Nasdaq 100 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Income Replacement and Nasdaq 100 Index Fund, you can compare the effects of market volatilities on Fidelity Income and Nasdaq 100 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 Income with a short position of Nasdaq 100. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Income and Nasdaq 100.
Diversification Opportunities for Fidelity Income and Nasdaq 100
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fidelity and Nasdaq is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Income Replacement and Nasdaq 100 Index Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq 100 Index and Fidelity Income 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 Income Replacement are associated (or correlated) with Nasdaq 100. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq 100 Index has no effect on the direction of Fidelity Income i.e., Fidelity Income and Nasdaq 100 go up and down completely randomly.
Pair Corralation between Fidelity Income and Nasdaq 100
Assuming the 90 days horizon Fidelity Income is expected to generate 4.33 times less return on investment than Nasdaq 100. But when comparing it to its historical volatility, Fidelity Income Replacement is 3.32 times less risky than Nasdaq 100. It trades about 0.19 of its potential returns per unit of risk. Nasdaq 100 Index Fund is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 4,998 in Nasdaq 100 Index Fund on September 1, 2024 and sell it today you would earn a total of 264.00 from holding Nasdaq 100 Index Fund or generate 5.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Fidelity Income Replacement vs. Nasdaq 100 Index Fund
Performance |
| Timeline |
| Fidelity Income Repl |
| Nasdaq 100 Index |
Fidelity Income and Nasdaq 100 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Income and Nasdaq 100
The main advantage of trading using opposite Fidelity Income and Nasdaq 100 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Income position performs unexpectedly, Nasdaq 100 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 Nasdaq 100 will offset losses from the drop in Nasdaq 100's long position.| Fidelity Income vs. Tax Managed Large Cap | Fidelity Income vs. Qs Large Cap | Fidelity Income vs. Jhancock Disciplined Value | Fidelity Income vs. John Hancock Investment |
| Nasdaq 100 vs. Alliancebernstein National Municipal | Nasdaq 100 vs. Nuveen Arizona Municipal | Nasdaq 100 vs. Bbh Intermediate Municipal | Nasdaq 100 vs. Old Westbury Municipal |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |