Correlation Between Fidelity MSCI and 031162DG2

Can any of the company-specific risk be diversified away by investing in both Fidelity MSCI and 031162DG2 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 MSCI and 031162DG2 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fidelity MSCI Financials and AMGN 44 22 FEB 62, you can compare the effects of market volatilities on Fidelity MSCI and 031162DG2 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 MSCI with a short position of 031162DG2. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity MSCI and 031162DG2.

Diversification Opportunities for Fidelity MSCI and 031162DG2

-0.72

Correlation Coefficient

Fidelity MSCI  031162DG2

Pay attention - limited upside

The 3 months correlation between Fidelity and 031162DG2 is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity MSCI Financials and AMGN 44 22 FEB 62 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMGN 44 22 and Fidelity MSCI 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 MSCI Financials are associated (or correlated) with 031162DG2. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMGN 44 22 has no effect on the direction of Fidelity MSCI i.e., Fidelity MSCI and 031162DG2 go up and down completely randomly.

Pair Corralation between Fidelity MSCI and 031162DG2

Given the investment horizon of 90 days Fidelity MSCI Financials is expected to under-perform the 031162DG2. In addition to that, Fidelity MSCI is 1.03 times more volatile than AMGN 44 22 FEB 62. It trades about -0.2 of its total potential returns per unit of risk. AMGN 44 22 FEB 62 is currently generating about -0.15 per unit of volatility. If you would invest  8,139  in AMGN 44 22 FEB 62 on September 26, 2024 and sell it today you would lose (223.00) from holding AMGN 44 22 FEB 62 or give up 2.74% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	85.71%
Values	Daily Returns

Fidelity MSCI Financials  vs.  AMGN 44 22 FEB 62

Fidelity MSCI Financials

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity MSCI Financials are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain fundamental indicators, Fidelity MSCI may actually be approaching a critical reversion point that can send shares even higher in January 2025.

AMGN 44 22

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AMGN 44 22 FEB 62 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for AMGN 44 22 FEB 62 investors.

Pair Trading with Fidelity MSCI and 031162DG2

The main advantage of trading using opposite Fidelity MSCI and 031162DG2 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity MSCI position performs unexpectedly, 031162DG2 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 031162DG2 will offset losses from the drop in 031162DG2's long position.

The idea behind Fidelity MSCI Financials and AMGN 44 22 FEB 62 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.