Correlation Between Guinness Atkinson and Fidelity Emerging
Can any of the company-specific risk be diversified away by investing in both Guinness Atkinson and Fidelity Emerging 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 Guinness Atkinson and Fidelity Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guinness Atkinson Asia and Fidelity Emerging Markets, you can compare the effects of market volatilities on Guinness Atkinson and Fidelity Emerging 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 Guinness Atkinson with a short position of Fidelity Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guinness Atkinson and Fidelity Emerging.
Diversification Opportunities for Guinness Atkinson and Fidelity Emerging
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guinness and Fidelity is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Guinness Atkinson Asia and Fidelity Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Emerging Markets and Guinness Atkinson 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 Guinness Atkinson Asia are associated (or correlated) with Fidelity Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Emerging Markets has no effect on the direction of Guinness Atkinson i.e., Guinness Atkinson and Fidelity Emerging go up and down completely randomly.
Pair Corralation between Guinness Atkinson and Fidelity Emerging
Assuming the 90 days horizon Guinness Atkinson Asia is expected to generate 2.27 times more return on investment than Fidelity Emerging. However, Guinness Atkinson is 2.27 times more volatile than Fidelity Emerging Markets. It trades about 0.15 of its potential returns per unit of risk. Fidelity Emerging Markets is currently generating about 0.01 per unit of risk. If you would invest 1,496 in Guinness Atkinson Asia on September 13, 2024 and sell it today you would earn a total of 47.00 from holding Guinness Atkinson Asia or generate 3.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guinness Atkinson Asia vs. Fidelity Emerging Markets
Performance |
| Timeline |
| Guinness Atkinson Asia |
| Fidelity Emerging Markets |
Guinness Atkinson and Fidelity Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guinness Atkinson and Fidelity Emerging
The main advantage of trading using opposite Guinness Atkinson and Fidelity Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guinness Atkinson position performs unexpectedly, Fidelity Emerging 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 Emerging will offset losses from the drop in Fidelity Emerging's long position.| Guinness Atkinson vs. Guinness Atkinson China | Guinness Atkinson vs. Guinness Atkinson Global | Guinness Atkinson vs. Guinness Atkinson Global |
| Fidelity Emerging vs. Fidelity Global Equity | Fidelity Emerging vs. Fidelity Total International | Fidelity Emerging vs. Fidelity International Value |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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