Correlation Between Cambria Micro and Fidelity Small
Can any of the company-specific risk be diversified away by investing in both Cambria Micro and Fidelity Small 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 Cambria Micro and Fidelity Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cambria Micro And and Fidelity Small Mid Cap, you can compare the effects of market volatilities on Cambria Micro and Fidelity Small 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 Cambria Micro with a short position of Fidelity Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cambria Micro and Fidelity Small.
Diversification Opportunities for Cambria Micro and Fidelity Small
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Cambria and Fidelity is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Cambria Micro And and Fidelity Small Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Small Mid and Cambria Micro 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 Cambria Micro And are associated (or correlated) with Fidelity Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Small Mid has no effect on the direction of Cambria Micro i.e., Cambria Micro and Fidelity Small go up and down completely randomly.
Pair Corralation between Cambria Micro and Fidelity Small
Given the investment horizon of 90 days Cambria Micro And is expected to generate 1.18 times more return on investment than Fidelity Small. However, Cambria Micro is 1.18 times more volatile than Fidelity Small Mid Cap. It trades about 0.27 of its potential returns per unit of risk. Fidelity Small Mid Cap is currently generating about 0.26 per unit of risk. If you would invest 2,617 in Cambria Micro And on August 28, 2024 and sell it today you would earn a total of 243.00 from holding Cambria Micro And or generate 9.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cambria Micro And vs. Fidelity Small Mid Cap
Performance |
| Timeline |
| Cambria Micro And |
| Fidelity Small Mid |
Cambria Micro and Fidelity Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cambria Micro and Fidelity Small
The main advantage of trading using opposite Cambria Micro and Fidelity Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cambria Micro position performs unexpectedly, Fidelity Small 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 Small will offset losses from the drop in Fidelity Small's long position.The idea behind Cambria Micro And and Fidelity Small Mid Cap 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.| Fidelity Small vs. Vanguard Mid Cap Index | Fidelity Small vs. iShares Core SP | Fidelity Small vs. SPDR SP MIDCAP | Fidelity Small vs. First Trust Dorsey |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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