Correlation Between Fidelity Government and New Perspective
Can any of the company-specific risk be diversified away by investing in both Fidelity Government and New Perspective 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 Fidelity Government and New Perspective into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Government Money and New Perspective Fund, you can compare the effects of market volatilities on Fidelity Government and New Perspective 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 Fidelity Government with a short position of New Perspective. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Government and New Perspective.
Diversification Opportunities for Fidelity Government and New Perspective
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fidelity and New is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Government Money and New Perspective Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Perspective and Fidelity Government 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 Fidelity Government Money are associated (or correlated) with New Perspective. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Perspective has no effect on the direction of Fidelity Government i.e., Fidelity Government and New Perspective go up and down completely randomly.
Pair Corralation between Fidelity Government and New Perspective
Assuming the 90 days horizon Fidelity Government is expected to generate 5.03 times less return on investment than New Perspective. But when comparing it to its historical volatility, Fidelity Government Money is 7.95 times less risky than New Perspective. It trades about 0.11 of its potential returns per unit of risk. New Perspective Fund is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 4,848 in New Perspective Fund on August 27, 2024 and sell it today you would earn a total of 1,491 from holding New Perspective Fund or generate 30.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 90.73% |
| Values | Daily Returns |
Fidelity Government Money vs. New Perspective Fund
Performance |
| Timeline |
| Fidelity Government Money |
| New Perspective |
Fidelity Government and New Perspective Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Government and New Perspective
The main advantage of trading using opposite Fidelity Government and New Perspective positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Government position performs unexpectedly, New Perspective 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 New Perspective will offset losses from the drop in New Perspective's long position.| Fidelity Government vs. Touchstone Large Cap | Fidelity Government vs. T Rowe Price | Fidelity Government vs. Siit Large Cap | Fidelity Government vs. Federated Mdt Large |
| New Perspective vs. Rbb Fund | New Perspective vs. Ips Strategic Capital | New Perspective vs. Balanced Fund Investor | New Perspective vs. Volumetric Fund Volumetric |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |