Correlation Between Fidelity Stock and Fidelity Mid
Can any of the company-specific risk be diversified away by investing in both Fidelity Stock and Fidelity Mid 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 Stock and Fidelity Mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Stock Selector and Fidelity Mid Cap, you can compare the effects of market volatilities on Fidelity Stock and Fidelity Mid 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 Stock with a short position of Fidelity Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Stock and Fidelity Mid.
Diversification Opportunities for Fidelity Stock and Fidelity Mid
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Fidelity and Fidelity is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Stock Selector and Fidelity Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Mid Cap and Fidelity Stock 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 Stock Selector are associated (or correlated) with Fidelity Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Mid Cap has no effect on the direction of Fidelity Stock i.e., Fidelity Stock and Fidelity Mid go up and down completely randomly.
Pair Corralation between Fidelity Stock and Fidelity Mid
Assuming the 90 days horizon Fidelity Stock Selector is expected to generate 0.78 times more return on investment than Fidelity Mid. However, Fidelity Stock Selector is 1.28 times less risky than Fidelity Mid. It trades about 0.35 of its potential returns per unit of risk. Fidelity Mid Cap is currently generating about 0.2 per unit of risk. If you would invest 2,720 in Fidelity Stock Selector on November 3, 2024 and sell it today you would earn a total of 139.00 from holding Fidelity Stock Selector or generate 5.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Stock Selector vs. Fidelity Mid Cap
Performance |
| Timeline |
| Fidelity Stock Selector |
| Fidelity Mid Cap |
Fidelity Stock and Fidelity Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Stock and Fidelity Mid
The main advantage of trading using opposite Fidelity Stock and Fidelity Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Stock position performs unexpectedly, Fidelity Mid 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 Mid will offset losses from the drop in Fidelity Mid's long position.| Fidelity Stock vs. Fidelity Mid Cap | Fidelity Stock vs. Fidelity Blue Chip | Fidelity Stock vs. Fidelity Value Discovery | Fidelity Stock vs. Fidelity Stock Selector |
| Fidelity Mid vs. Fidelity Stock Selector | Fidelity Mid vs. Fidelity Value Discovery | Fidelity Mid vs. Fidelity Small Cap | Fidelity Mid vs. Fidelity Small Cap |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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