Correlation Between Short Oil and Fidelity Freedom
Can any of the company-specific risk be diversified away by investing in both Short Oil and Fidelity Freedom 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 Short Oil and Fidelity Freedom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Short Oil Gas and Fidelity Freedom Blend, you can compare the effects of market volatilities on Short Oil and Fidelity Freedom 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 Short Oil with a short position of Fidelity Freedom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Short Oil and Fidelity Freedom.
Diversification Opportunities for Short Oil and Fidelity Freedom
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Short and Fidelity is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Short Oil Gas and Fidelity Freedom Blend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Freedom Blend and Short Oil 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 Short Oil Gas are associated (or correlated) with Fidelity Freedom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Freedom Blend has no effect on the direction of Short Oil i.e., Short Oil and Fidelity Freedom go up and down completely randomly.
Pair Corralation between Short Oil and Fidelity Freedom
Assuming the 90 days horizon Short Oil Gas is expected to under-perform the Fidelity Freedom. In addition to that, Short Oil is 1.97 times more volatile than Fidelity Freedom Blend. It trades about -0.08 of its total potential returns per unit of risk. Fidelity Freedom Blend is currently generating about 0.11 per unit of volatility. If you would invest 1,260 in Fidelity Freedom Blend on August 31, 2024 and sell it today you would earn a total of 52.00 from holding Fidelity Freedom Blend or generate 4.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Short Oil Gas vs. Fidelity Freedom Blend
Performance |
| Timeline |
| Short Oil Gas |
| Fidelity Freedom Blend |
Short Oil and Fidelity Freedom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Short Oil and Fidelity Freedom
The main advantage of trading using opposite Short Oil and Fidelity Freedom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Short Oil position performs unexpectedly, Fidelity Freedom 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 Freedom will offset losses from the drop in Fidelity Freedom's long position.| Short Oil vs. Short Precious Metals | Short Oil vs. Income Growth Fund | Short Oil vs. Loomis Sayles International | Short Oil vs. Walmart |
| Fidelity Freedom vs. Gamco Global Gold | Fidelity Freedom vs. Great West Goldman Sachs | Fidelity Freedom vs. Fidelity Advisor Gold | Fidelity Freedom vs. Europac Gold 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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