Correlation Between Fidelity Short-term and Fidelity Gnma
Can any of the company-specific risk be diversified away by investing in both Fidelity Short-term and Fidelity Gnma 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 Short-term and Fidelity Gnma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Short Term Bond and Fidelity Gnma Fund, you can compare the effects of market volatilities on Fidelity Short-term and Fidelity Gnma 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 Short-term with a short position of Fidelity Gnma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Short-term and Fidelity Gnma.
Diversification Opportunities for Fidelity Short-term and Fidelity Gnma
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fidelity and Fidelity is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Short Term Bond and Fidelity Gnma Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Gnma and Fidelity Short-term 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 Short Term Bond are associated (or correlated) with Fidelity Gnma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Gnma has no effect on the direction of Fidelity Short-term i.e., Fidelity Short-term and Fidelity Gnma go up and down completely randomly.
Pair Corralation between Fidelity Short-term and Fidelity Gnma
Assuming the 90 days horizon Fidelity Short-term is expected to generate 1.05 times less return on investment than Fidelity Gnma. But when comparing it to its historical volatility, Fidelity Short Term Bond is 2.92 times less risky than Fidelity Gnma. It trades about 0.17 of its potential returns per unit of risk. Fidelity Gnma Fund is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 949.00 in Fidelity Gnma Fund on August 24, 2024 and sell it today you would earn a total of 56.00 from holding Fidelity Gnma Fund or generate 5.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Short Term Bond vs. Fidelity Gnma Fund
Performance |
| Timeline |
| Fidelity Short Term |
| Fidelity Gnma |
Fidelity Short-term and Fidelity Gnma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Short-term and Fidelity Gnma
The main advantage of trading using opposite Fidelity Short-term and Fidelity Gnma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Short-term position performs unexpectedly, Fidelity Gnma 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 Gnma will offset losses from the drop in Fidelity Gnma's long position.| Fidelity Short-term vs. Fidelity Investment Grade | Fidelity Short-term vs. Fidelity Total Bond | Fidelity Short-term vs. Fidelity Gnma Fund | Fidelity Short-term vs. Fidelity Intermediate Bond |
| Fidelity Gnma vs. Fidelity Government Income | Fidelity Gnma vs. Fidelity Short Term Bond | Fidelity Gnma vs. Fidelity Total Bond | Fidelity Gnma vs. Fidelity New Markets |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |