Correlation Between Fidelity Extended and Fidelity Large
Can any of the company-specific risk be diversified away by investing in both Fidelity Extended and Fidelity Large 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 Extended and Fidelity Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Extended Market and Fidelity Large Cap, you can compare the effects of market volatilities on Fidelity Extended and Fidelity Large 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 Extended with a short position of Fidelity Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Extended and Fidelity Large.
Diversification Opportunities for Fidelity Extended and Fidelity Large
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fidelity and Fidelity is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Extended Market and Fidelity Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Large Cap and Fidelity Extended 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 Extended Market are associated (or correlated) with Fidelity Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Large Cap has no effect on the direction of Fidelity Extended i.e., Fidelity Extended and Fidelity Large go up and down completely randomly.
Pair Corralation between Fidelity Extended and Fidelity Large
Assuming the 90 days horizon Fidelity Extended Market is expected to generate 1.67 times more return on investment than Fidelity Large. However, Fidelity Extended is 1.67 times more volatile than Fidelity Large Cap. It trades about 0.35 of its potential returns per unit of risk. Fidelity Large Cap is currently generating about 0.2 per unit of risk. If you would invest 8,903 in Fidelity Extended Market on August 30, 2024 and sell it today you would earn a total of 966.00 from holding Fidelity Extended Market or generate 10.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Extended Market vs. Fidelity Large Cap
Performance |
| Timeline |
| Fidelity Extended Market |
| Fidelity Large Cap |
Fidelity Extended and Fidelity Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Extended and Fidelity Large
The main advantage of trading using opposite Fidelity Extended and Fidelity Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Extended position performs unexpectedly, Fidelity Large 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 Large will offset losses from the drop in Fidelity Large's long position.| Fidelity Extended vs. Fidelity International Index | Fidelity Extended vs. Fidelity 500 Index | Fidelity Extended vs. Fidelity Bond Index | Fidelity Extended vs. Fidelity Total Market |
| Fidelity Large vs. Vanguard Total Stock | Fidelity Large vs. Vanguard 500 Index | Fidelity Large vs. Vanguard Total Stock | Fidelity Large vs. Vanguard Total Stock |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |