Correlation Between Fidelity Sai and Free Market
Can any of the company-specific risk be diversified away by investing in both Fidelity Sai and Free Market 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 Sai and Free Market into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Sai Convertible and Free Market Fixed, you can compare the effects of market volatilities on Fidelity Sai and Free Market 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 Sai with a short position of Free Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Sai and Free Market.
Diversification Opportunities for Fidelity Sai and Free Market
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Fidelity and Free is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Sai Convertible and Free Market Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Free Market Fixed and Fidelity Sai 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 Sai Convertible are associated (or correlated) with Free Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Free Market Fixed has no effect on the direction of Fidelity Sai i.e., Fidelity Sai and Free Market go up and down completely randomly.
Pair Corralation between Fidelity Sai and Free Market
Assuming the 90 days horizon Fidelity Sai Convertible is expected to generate 1.0 times more return on investment than Free Market. However, Fidelity Sai Convertible is as risky as Free Market. It trades about 0.25 of its potential returns per unit of risk. Free Market Fixed is currently generating about 0.14 per unit of risk. If you would invest 984.00 in Fidelity Sai Convertible on August 31, 2024 and sell it today you would earn a total of 112.00 from holding Fidelity Sai Convertible or generate 11.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 82.84% |
| Values | Daily Returns |
Fidelity Sai Convertible vs. Free Market Fixed
Performance |
| Timeline |
| Fidelity Sai Convertible |
| Free Market Fixed |
Fidelity Sai and Free Market Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Sai and Free Market
The main advantage of trading using opposite Fidelity Sai and Free Market positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Sai position performs unexpectedly, Free Market 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 Free Market will offset losses from the drop in Free Market's long position.| Fidelity Sai vs. Calamos Market Neutral | Fidelity Sai vs. Calamos Market Neutral | Fidelity Sai vs. Aqr Diversified Arbitrage | Fidelity Sai vs. Aqr Diversified Arbitrage |
| Free Market vs. Virtus Convertible | Free Market vs. Fidelity Sai Convertible | Free Market vs. Absolute Convertible Arbitrage | Free Market vs. Advent Claymore Convertible |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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