Correlation Between Vanguard Small-cap and Fidelity Series
Can any of the company-specific risk be diversified away by investing in both Vanguard Small-cap 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 Vanguard Small-cap and Fidelity Series into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Small Cap Value and Fidelity Series International, you can compare the effects of market volatilities on Vanguard Small-cap 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 Vanguard Small-cap with a short position of Fidelity Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Small-cap and Fidelity Series.
Diversification Opportunities for Vanguard Small-cap and Fidelity Series
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Vanguard and Fidelity is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Small Cap Value 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 Vanguard Small-cap 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 Vanguard Small Cap Value 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 Vanguard Small-cap i.e., Vanguard Small-cap and Fidelity Series go up and down completely randomly.
Pair Corralation between Vanguard Small-cap and Fidelity Series
Assuming the 90 days horizon Vanguard Small Cap Value is expected to generate 1.29 times more return on investment than Fidelity Series. However, Vanguard Small-cap is 1.29 times more volatile than Fidelity Series International. It trades about 0.04 of its potential returns per unit of risk. Fidelity Series International is currently generating about 0.05 per unit of risk. If you would invest 3,863 in Vanguard Small Cap Value on October 11, 2024 and sell it today you would earn a total of 896.00 from holding Vanguard Small Cap Value or generate 23.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Small Cap Value vs. Fidelity Series International
Performance |
| Timeline |
| Vanguard Small Cap |
| Fidelity Series Inte |
Vanguard Small-cap and Fidelity Series Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Small-cap and Fidelity Series
The main advantage of trading using opposite Vanguard Small-cap and Fidelity Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Small-cap 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.| Vanguard Small-cap vs. Lord Abbett Diversified | Vanguard Small-cap vs. Saat Market Growth | Vanguard Small-cap vs. Oshaughnessy Market Leaders | Vanguard Small-cap vs. Alphacentric Hedged Market |
| Fidelity Series vs. Ultramid Cap Profund Ultramid Cap | Fidelity Series vs. Victory Rs Partners | Fidelity Series vs. Vanguard Small Cap Value | Fidelity Series vs. Lord Abbett Small |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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