Correlation Between Nationwide Global and Fidelity Freedom
Can any of the company-specific risk be diversified away by investing in both Nationwide Global and Fidelity Freedom 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 Nationwide Global and Fidelity Freedom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nationwide Global Equity and Fidelity Freedom Index, you can compare the effects of market volatilities on Nationwide Global and Fidelity Freedom 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 Nationwide Global with a short position of Fidelity Freedom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nationwide Global and Fidelity Freedom.
Diversification Opportunities for Nationwide Global and Fidelity Freedom
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NATIONWIDE and Fidelity is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Nationwide Global Equity and Fidelity Freedom Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Freedom Index and Nationwide Global 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 Nationwide Global Equity are associated (or correlated) with Fidelity Freedom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Freedom Index has no effect on the direction of Nationwide Global i.e., Nationwide Global and Fidelity Freedom go up and down completely randomly.
Pair Corralation between Nationwide Global and Fidelity Freedom
Assuming the 90 days horizon Nationwide Global Equity is expected to generate 1.87 times more return on investment than Fidelity Freedom. However, Nationwide Global is 1.87 times more volatile than Fidelity Freedom Index. It trades about 0.06 of its potential returns per unit of risk. Fidelity Freedom Index is currently generating about 0.09 per unit of risk. If you would invest 1,967 in Nationwide Global Equity on September 5, 2024 and sell it today you would earn a total of 516.00 from holding Nationwide Global Equity or generate 26.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Nationwide Global Equity vs. Fidelity Freedom Index
Performance |
| Timeline |
| Nationwide Global Equity |
| Fidelity Freedom Index |
Nationwide Global and Fidelity Freedom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nationwide Global and Fidelity Freedom
The main advantage of trading using opposite Nationwide Global and Fidelity Freedom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nationwide Global position performs unexpectedly, Fidelity Freedom 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 Freedom will offset losses from the drop in Fidelity Freedom's long position.| Nationwide Global vs. Intermediate Term Tax Free Bond | Nationwide Global vs. Bbh Intermediate Municipal | Nationwide Global vs. Morningstar Municipal Bond | Nationwide Global vs. Nuveen Minnesota Municipal |
| Fidelity Freedom vs. Fidelity Income Replacement | Fidelity Freedom vs. Fidelity Income Replacement | Fidelity Freedom vs. Fidelity Income Replacement | Fidelity Freedom vs. Fidelity Income Replacement |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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