Correlation Between Sit Emerging and Fidelity New
Can any of the company-specific risk be diversified away by investing in both Sit Emerging and Fidelity New 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 Sit Emerging and Fidelity New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sit Emerging Markets and Fidelity New Markets, you can compare the effects of market volatilities on Sit Emerging and Fidelity New 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 Sit Emerging with a short position of Fidelity New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sit Emerging and Fidelity New.
Diversification Opportunities for Sit Emerging and Fidelity New
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sit and Fidelity is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Sit Emerging Markets and Fidelity New Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity New Markets and Sit Emerging 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 Sit Emerging Markets are associated (or correlated) with Fidelity New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity New Markets has no effect on the direction of Sit Emerging i.e., Sit Emerging and Fidelity New go up and down completely randomly.
Pair Corralation between Sit Emerging and Fidelity New
Assuming the 90 days horizon Sit Emerging is expected to generate 1.41 times less return on investment than Fidelity New. In addition to that, Sit Emerging is 1.03 times more volatile than Fidelity New Markets. It trades about 0.09 of its total potential returns per unit of risk. Fidelity New Markets is currently generating about 0.13 per unit of volatility. If you would invest 1,134 in Fidelity New Markets on August 24, 2024 and sell it today you would earn a total of 139.00 from holding Fidelity New Markets or generate 12.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sit Emerging Markets vs. Fidelity New Markets
Performance |
| Timeline |
| Sit Emerging Markets |
| Fidelity New Markets |
Sit Emerging and Fidelity New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sit Emerging and Fidelity New
The main advantage of trading using opposite Sit Emerging and Fidelity New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sit Emerging position performs unexpectedly, Fidelity New 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 New will offset losses from the drop in Fidelity New's long position.| Sit Emerging vs. Gmo Emerging Ntry | Sit Emerging vs. HUMANA INC | Sit Emerging vs. Aquagold International | Sit Emerging vs. Barloworld Ltd ADR |
| Fidelity New vs. Gmo Emerging Ntry | Fidelity New vs. Sit Emerging Markets | Fidelity New vs. HUMANA INC | Fidelity New 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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