Correlation Between Fidelity Trend and Fidelity Focused
Can any of the company-specific risk be diversified away by investing in both Fidelity Trend and Fidelity Focused 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 Trend and Fidelity Focused into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Trend Fund and Fidelity Focused Stock, you can compare the effects of market volatilities on Fidelity Trend and Fidelity Focused 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 Trend with a short position of Fidelity Focused. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Trend and Fidelity Focused.
Diversification Opportunities for Fidelity Trend and Fidelity Focused
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between FIDELITY and Fidelity is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Trend Fund and Fidelity Focused Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Focused Stock and Fidelity Trend 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 Trend Fund are associated (or correlated) with Fidelity Focused. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Focused Stock has no effect on the direction of Fidelity Trend i.e., Fidelity Trend and Fidelity Focused go up and down completely randomly.
Pair Corralation between Fidelity Trend and Fidelity Focused
Assuming the 90 days horizon Fidelity Trend Fund is expected to generate 1.1 times more return on investment than Fidelity Focused. However, Fidelity Trend is 1.1 times more volatile than Fidelity Focused Stock. It trades about 0.09 of its potential returns per unit of risk. Fidelity Focused Stock is currently generating about 0.07 per unit of risk. If you would invest 18,234 in Fidelity Trend Fund on September 3, 2024 and sell it today you would earn a total of 3,083 from holding Fidelity Trend Fund or generate 16.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Trend Fund vs. Fidelity Focused Stock
Performance |
| Timeline |
| Fidelity Trend |
| Fidelity Focused Stock |
Fidelity Trend and Fidelity Focused Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Trend and Fidelity Focused
The main advantage of trading using opposite Fidelity Trend and Fidelity Focused positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Trend position performs unexpectedly, Fidelity Focused 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 Focused will offset losses from the drop in Fidelity Focused's long position.| Fidelity Trend vs. Fidelity Stock Selector | Fidelity Trend vs. Fidelity Focused Stock | Fidelity Trend vs. Fidelity Disciplined Equity | Fidelity Trend vs. Fidelity Stock Selector |
| Fidelity Focused vs. Fidelity Trend Fund | Fidelity Focused vs. Fidelity Large Cap | Fidelity Focused vs. Fidelity Growth Discovery | Fidelity Focused vs. Fidelity Mega 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |