Correlation Between Fidelity Bond and Fidelity Global
Can any of the company-specific risk be diversified away by investing in both Fidelity Bond and Fidelity Global 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 Bond and Fidelity Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Bond Index and Fidelity Global Ex, you can compare the effects of market volatilities on Fidelity Bond and Fidelity Global 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 Bond with a short position of Fidelity Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Bond and Fidelity Global.
Diversification Opportunities for Fidelity Bond and Fidelity Global
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fidelity and Fidelity is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Bond Index and Fidelity Global Ex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Global Ex and Fidelity Bond 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 Bond Index are associated (or correlated) with Fidelity Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Global Ex has no effect on the direction of Fidelity Bond i.e., Fidelity Bond and Fidelity Global go up and down completely randomly.
Pair Corralation between Fidelity Bond and Fidelity Global
Assuming the 90 days horizon Fidelity Bond Index is expected to generate 0.5 times more return on investment than Fidelity Global. However, Fidelity Bond Index is 2.02 times less risky than Fidelity Global. It trades about 0.16 of its potential returns per unit of risk. Fidelity Global Ex is currently generating about -0.01 per unit of risk. If you would invest 1,032 in Fidelity Bond Index on September 12, 2024 and sell it today you would earn a total of 10.00 from holding Fidelity Bond Index or generate 0.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Bond Index vs. Fidelity Global Ex
Performance |
| Timeline |
| Fidelity Bond Index |
| Fidelity Global Ex |
Fidelity Bond and Fidelity Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Bond and Fidelity Global
The main advantage of trading using opposite Fidelity Bond and Fidelity Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Bond position performs unexpectedly, Fidelity Global 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 Global will offset losses from the drop in Fidelity Global's long position.| Fidelity Bond vs. Fidelity International Index | Fidelity Bond vs. Fidelity Total International | Fidelity Bond vs. Fidelity Total Market | Fidelity Bond vs. Fidelity Extended Market |
| Fidelity Global vs. Fidelity Bond Index | Fidelity Global vs. Fidelity Emerging Markets | Fidelity Global vs. Fidelity Small Cap | Fidelity Global vs. Fidelity Mid 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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