Correlation Between Fidelity Freedom and Elfun Diversified
Can any of the company-specific risk be diversified away by investing in both Fidelity Freedom and Elfun Diversified 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 Freedom and Elfun Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Freedom 2035 and Elfun Diversified Fund, you can compare the effects of market volatilities on Fidelity Freedom and Elfun Diversified 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 Freedom with a short position of Elfun Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Freedom and Elfun Diversified.
Diversification Opportunities for Fidelity Freedom and Elfun Diversified
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Fidelity and Elfun is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Freedom 2035 and Elfun Diversified Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elfun Diversified and Fidelity Freedom 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 Freedom 2035 are associated (or correlated) with Elfun Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elfun Diversified has no effect on the direction of Fidelity Freedom i.e., Fidelity Freedom and Elfun Diversified go up and down completely randomly.
Pair Corralation between Fidelity Freedom and Elfun Diversified
Assuming the 90 days horizon Fidelity Freedom 2035 is expected to generate 1.12 times more return on investment than Elfun Diversified. However, Fidelity Freedom is 1.12 times more volatile than Elfun Diversified Fund. It trades about 0.11 of its potential returns per unit of risk. Elfun Diversified Fund is currently generating about 0.12 per unit of risk. If you would invest 1,424 in Fidelity Freedom 2035 on September 12, 2024 and sell it today you would earn a total of 229.00 from holding Fidelity Freedom 2035 or generate 16.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Freedom 2035 vs. Elfun Diversified Fund
Performance |
| Timeline |
| Fidelity Freedom 2035 |
| Elfun Diversified |
Fidelity Freedom and Elfun Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Freedom and Elfun Diversified
The main advantage of trading using opposite Fidelity Freedom and Elfun Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Freedom position performs unexpectedly, Elfun Diversified 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 Elfun Diversified will offset losses from the drop in Elfun Diversified's long position.| Fidelity Freedom vs. Elfun Diversified Fund | Fidelity Freedom vs. Guggenheim Diversified Income | Fidelity Freedom vs. Prudential Core Conservative | Fidelity Freedom vs. Western Asset Diversified |
| Elfun Diversified vs. Income Fund Of | Elfun Diversified vs. Income Fund Of | Elfun Diversified vs. Income Fund Of | Elfun Diversified vs. Income Fund Of |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |