Correlation Between Merck and Fidelity Growth
Can any of the company-specific risk be diversified away by investing in both Merck and Fidelity Growth 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 Merck and Fidelity Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Merck Company and Fidelity Growth Opportunities, you can compare the effects of market volatilities on Merck and Fidelity Growth 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 Merck with a short position of Fidelity Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merck and Fidelity Growth.
Diversification Opportunities for Merck and Fidelity Growth
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Merck and Fidelity is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Merck Company and Fidelity Growth Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Growth Oppo and Merck 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 Merck Company are associated (or correlated) with Fidelity Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Growth Oppo has no effect on the direction of Merck i.e., Merck and Fidelity Growth go up and down completely randomly.
Pair Corralation between Merck and Fidelity Growth
If you would invest 2,110 in Fidelity Growth Opportunities on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Fidelity Growth Opportunities or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Merck Company vs. Fidelity Growth Opportunities
Performance |
| Timeline |
| Merck Company |
| Fidelity Growth Oppo |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Merck and Fidelity Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merck and Fidelity Growth
The main advantage of trading using opposite Merck and Fidelity Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merck position performs unexpectedly, Fidelity Growth 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 Growth will offset losses from the drop in Fidelity Growth's long position.| Merck vs. Pharvaris BV | Merck vs. Brinker International | Merck vs. Alcoa Corp | Merck vs. Direxion Daily FTSE |
| Fidelity Growth vs. Fidelity Covington Trust | Fidelity Growth vs. Fidelity Real Estate | Fidelity Growth vs. Fidelity Blue Chip | Fidelity Growth vs. Fidelity Blue Chip |
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
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |