Correlation Between NYSE Composite and Fidelity Global
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Fidelity Global 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 NYSE Composite and Fidelity Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Fidelity Global Equity, you can compare the effects of market volatilities on NYSE Composite and Fidelity Global 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 NYSE Composite with a short position of Fidelity Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Fidelity Global.
Diversification Opportunities for NYSE Composite and Fidelity Global
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NYSE and Fidelity is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Fidelity Global Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Global Equity and NYSE Composite 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 NYSE Composite are associated (or correlated) with Fidelity Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Global Equity has no effect on the direction of NYSE Composite i.e., NYSE Composite and Fidelity Global go up and down completely randomly.
Pair Corralation between NYSE Composite and Fidelity Global
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.14 times more return on investment than Fidelity Global. However, NYSE Composite is 1.14 times more volatile than Fidelity Global Equity. It trades about 0.08 of its potential returns per unit of risk. Fidelity Global Equity is currently generating about 0.08 per unit of risk. If you would invest 1,547,479 in NYSE Composite on August 26, 2024 and sell it today you would earn a total of 464,866 from holding NYSE Composite or generate 30.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Fidelity Global Equity
Performance |
| Timeline |
NYSE Composite and Fidelity Global Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Fidelity Global Equity
Pair trading matchups for Fidelity Global
Pair Trading with NYSE Composite and Fidelity Global
The main advantage of trading using opposite NYSE Composite and Fidelity Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Fidelity Global 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 Global will offset losses from the drop in Fidelity Global's long position.| NYSE Composite vs. Glacier Bancorp | NYSE Composite vs. LithiumBank Resources Corp | NYSE Composite vs. Stepstone Group | NYSE Composite vs. Pintec Technology Holdings |
| Fidelity Global vs. Fidelity Emerging Markets | Fidelity Global vs. Fidelity Total International | Fidelity Global vs. Fidelity International Value | Fidelity Global vs. Aquagold International |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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