Correlation Between Touchstone Premium and Fidelity Series
Can any of the company-specific risk be diversified away by investing in both Touchstone Premium 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 Touchstone Premium and Fidelity Series into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Touchstone Premium Yield and Fidelity Series Real, you can compare the effects of market volatilities on Touchstone Premium 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 Touchstone Premium with a short position of Fidelity Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone Premium and Fidelity Series.
Diversification Opportunities for Touchstone Premium and Fidelity Series
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Touchstone and Fidelity is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone Premium Yield and Fidelity Series Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Series Real and Touchstone Premium 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 Touchstone Premium Yield 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 Real has no effect on the direction of Touchstone Premium i.e., Touchstone Premium and Fidelity Series go up and down completely randomly.
Pair Corralation between Touchstone Premium and Fidelity Series
Assuming the 90 days horizon Touchstone Premium Yield is expected to generate 3.53 times more return on investment than Fidelity Series. However, Touchstone Premium is 3.53 times more volatile than Fidelity Series Real. It trades about 0.06 of its potential returns per unit of risk. Fidelity Series Real is currently generating about 0.12 per unit of risk. If you would invest 693.00 in Touchstone Premium Yield on September 3, 2024 and sell it today you would earn a total of 201.00 from holding Touchstone Premium Yield or generate 29.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Touchstone Premium Yield vs. Fidelity Series Real
Performance |
| Timeline |
| Touchstone Premium Yield |
| Fidelity Series Real |
Touchstone Premium and Fidelity Series Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Touchstone Premium and Fidelity Series
The main advantage of trading using opposite Touchstone Premium and Fidelity Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchstone Premium 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.| Touchstone Premium vs. Dodge Cox Emerging | Touchstone Premium vs. Jpmorgan Emerging Markets | Touchstone Premium vs. Templeton Emerging Markets | Touchstone Premium vs. Legg Mason Partners |
| Fidelity Series vs. Vanguard Small Cap Value | Fidelity Series vs. Ab Discovery Value | Fidelity Series vs. Royce Opportunity Fund | Fidelity Series vs. Columbia Small Cap |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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