Correlation Between Guidemark(r) Small/mid and Fidelity Dividend
Can any of the company-specific risk be diversified away by investing in both Guidemark(r) Small/mid and Fidelity Dividend 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 Guidemark(r) Small/mid and Fidelity Dividend into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guidemark Smallmid Cap and Fidelity Dividend Growth, you can compare the effects of market volatilities on Guidemark(r) Small/mid and Fidelity Dividend 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 Guidemark(r) Small/mid with a short position of Fidelity Dividend. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guidemark(r) Small/mid and Fidelity Dividend.
Diversification Opportunities for Guidemark(r) Small/mid and Fidelity Dividend
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guidemark(r) and Fidelity is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Guidemark Smallmid Cap and Fidelity Dividend Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Dividend Growth and Guidemark(r) Small/mid 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 Guidemark Smallmid Cap are associated (or correlated) with Fidelity Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Dividend Growth has no effect on the direction of Guidemark(r) Small/mid i.e., Guidemark(r) Small/mid and Fidelity Dividend go up and down completely randomly.
Pair Corralation between Guidemark(r) Small/mid and Fidelity Dividend
Assuming the 90 days horizon Guidemark Smallmid Cap is expected to under-perform the Fidelity Dividend. In addition to that, Guidemark(r) Small/mid is 1.17 times more volatile than Fidelity Dividend Growth. It trades about -0.01 of its total potential returns per unit of risk. Fidelity Dividend Growth is currently generating about 0.03 per unit of volatility. If you would invest 3,565 in Fidelity Dividend Growth on December 4, 2024 and sell it today you would earn a total of 253.00 from holding Fidelity Dividend Growth or generate 7.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.59% |
| Values | Daily Returns |
Guidemark Smallmid Cap vs. Fidelity Dividend Growth
Performance |
| Timeline |
| Guidemark Smallmid Cap |
| Fidelity Dividend Growth |
Guidemark(r) Small/mid and Fidelity Dividend Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guidemark(r) Small/mid and Fidelity Dividend
The main advantage of trading using opposite Guidemark(r) Small/mid and Fidelity Dividend positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guidemark(r) Small/mid position performs unexpectedly, Fidelity Dividend 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 Dividend will offset losses from the drop in Fidelity Dividend's long position.| Guidemark(r) Small/mid vs. Ab Municipal Bond | Guidemark(r) Small/mid vs. Bbh Intermediate Municipal | Guidemark(r) Small/mid vs. John Hancock Government | Guidemark(r) Small/mid vs. Legg Mason Partners |
| Fidelity Dividend vs. Harbor Diversified International | Fidelity Dividend vs. Lord Abbett Diversified | Fidelity Dividend vs. Diversified Bond Fund | Fidelity Dividend vs. Western Asset Diversified |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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