Correlation Between NYSE Composite and Fidelity Series
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Fidelity Series 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 Series 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 Series International, you can compare the effects of market volatilities on NYSE Composite and Fidelity Series 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 Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Fidelity Series.
Diversification Opportunities for NYSE Composite and Fidelity Series
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between NYSE and Fidelity is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Fidelity Series International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Series Inte 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 Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Series Inte has no effect on the direction of NYSE Composite i.e., NYSE Composite and Fidelity Series go up and down completely randomly.
Pair Corralation between NYSE Composite and Fidelity Series
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.83 times more return on investment than Fidelity Series. However, NYSE Composite is 1.2 times less risky than Fidelity Series. It trades about 0.13 of its potential returns per unit of risk. Fidelity Series International is currently generating about -0.09 per unit of risk. If you would invest 1,959,424 in NYSE Composite on August 24, 2024 and sell it today you would earn a total of 37,406 from holding NYSE Composite or generate 1.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Fidelity Series International
Performance |
| Timeline |
NYSE Composite and Fidelity Series Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Fidelity Series International
Pair trading matchups for Fidelity Series
Pair Trading with NYSE Composite and Fidelity Series
The main advantage of trading using opposite NYSE Composite and Fidelity Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Fidelity Series 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 Series will offset losses from the drop in Fidelity Series' long position.| NYSE Composite vs. Akanda Corp | NYSE Composite vs. Valneva SE ADR | NYSE Composite vs. Radcom | NYSE Composite vs. Western Digital |
| Fidelity Series vs. Red Oak Technology | Fidelity Series vs. Invesco Technology Fund | Fidelity Series vs. Science Technology Fund | Fidelity Series vs. Hennessy Technology Fund |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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