Correlation Between Fidelity Sai and Causeway Emerging
Can any of the company-specific risk be diversified away by investing in both Fidelity Sai and Causeway Emerging 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 Causeway Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Sai Treasury and Causeway Emerging Markets, you can compare the effects of market volatilities on Fidelity Sai and Causeway Emerging 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 Causeway Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Sai and Causeway Emerging.
Diversification Opportunities for Fidelity Sai and Causeway Emerging
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Fidelity and Causeway is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Sai Treasury and Causeway Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Causeway Emerging Markets 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 Treasury are associated (or correlated) with Causeway Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Causeway Emerging Markets has no effect on the direction of Fidelity Sai i.e., Fidelity Sai and Causeway Emerging go up and down completely randomly.
Pair Corralation between Fidelity Sai and Causeway Emerging
Assuming the 90 days horizon Fidelity Sai Treasury is expected to generate 0.39 times more return on investment than Causeway Emerging. However, Fidelity Sai Treasury is 2.56 times less risky than Causeway Emerging. It trades about 0.08 of its potential returns per unit of risk. Causeway Emerging Markets is currently generating about -0.11 per unit of risk. If you would invest 876.00 in Fidelity Sai Treasury on September 1, 2024 and sell it today you would earn a total of 5.00 from holding Fidelity Sai Treasury or generate 0.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Fidelity Sai Treasury vs. Causeway Emerging Markets
Performance |
| Timeline |
| Fidelity Sai Treasury |
| Causeway Emerging Markets |
Fidelity Sai and Causeway Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Sai and Causeway Emerging
The main advantage of trading using opposite Fidelity Sai and Causeway Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Sai position performs unexpectedly, Causeway Emerging 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 Causeway Emerging will offset losses from the drop in Causeway Emerging's long position.| Fidelity Sai vs. Fidelity Freedom 2015 | Fidelity Sai vs. Fidelity Puritan Fund | Fidelity Sai vs. Fidelity Puritan Fund | Fidelity Sai vs. Fidelity Pennsylvania Municipal |
| Causeway Emerging vs. Causeway International Small | Causeway Emerging vs. Causeway Global Value | Causeway Emerging vs. Causeway Global Value | Causeway Emerging vs. Causeway International Small |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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