Correlation Between GM and Fidelity Summer
Can any of the company-specific risk be diversified away by investing in both GM and Fidelity Summer 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 GM and Fidelity Summer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Fidelity Summer Street, you can compare the effects of market volatilities on GM and Fidelity Summer 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 GM with a short position of Fidelity Summer. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Fidelity Summer.
Diversification Opportunities for GM and Fidelity Summer
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GM and Fidelity is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Fidelity Summer Street in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Summer Street and GM 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 General Motors are associated (or correlated) with Fidelity Summer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Summer Street has no effect on the direction of GM i.e., GM and Fidelity Summer go up and down completely randomly.
Pair Corralation between GM and Fidelity Summer
If you would invest (100.00) in Fidelity Summer Street on November 28, 2024 and sell it today you would earn a total of 100.00 from holding Fidelity Summer Street or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
General Motors vs. Fidelity Summer Street
Performance |
| Timeline |
| General Motors |
| Fidelity Summer Street |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
GM and Fidelity Summer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Fidelity Summer
The main advantage of trading using opposite GM and Fidelity Summer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Fidelity Summer 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 Summer will offset losses from the drop in Fidelity Summer's long position.The idea behind General Motors and Fidelity Summer Street pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |