Correlation Between GraniteShares and Fidelity Sustainable

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

By analyzing existing cross correlation between GraniteShares 3x Short and Fidelity Sustainable Research, you can compare the effects of market volatilities on GraniteShares and Fidelity Sustainable 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 GraniteShares with a short position of Fidelity Sustainable. Check out your portfolio center. Please also check ongoing floating volatility patterns of GraniteShares and Fidelity Sustainable.

Diversification Opportunities for GraniteShares and Fidelity Sustainable

-0.77

Correlation Coefficient

GraniteShares  Fidelity Sustainable

Pay attention - limited upside

The 3 months correlation between GraniteShares and Fidelity is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding GraniteShares 3x Short and Fidelity Sustainable Research in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Sustainable and GraniteShares 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 GraniteShares 3x Short are associated (or correlated) with Fidelity Sustainable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Sustainable has no effect on the direction of GraniteShares i.e., GraniteShares and Fidelity Sustainable go up and down completely randomly.

Pair Corralation between GraniteShares and Fidelity Sustainable

Assuming the 90 days trading horizon GraniteShares 3x Short is expected to under-perform the Fidelity Sustainable. In addition to that, GraniteShares is 11.63 times more volatile than Fidelity Sustainable Research. It trades about -0.1 of its total potential returns per unit of risk. Fidelity Sustainable Research is currently generating about 0.16 per unit of volatility. If you would invest  918.00  in Fidelity Sustainable Research on September 13, 2024 and sell it today you would earn a total of  56.00  from holding Fidelity Sustainable Research or generate 6.1% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

GraniteShares 3x Short  vs.  Fidelity Sustainable Research

GraniteShares 3x Short

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GraniteShares 3x Short has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Etf's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the exchange-traded fund private investors.

Fidelity Sustainable

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Sustainable Research are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Fidelity Sustainable is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with GraniteShares and Fidelity Sustainable

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

The idea behind GraniteShares 3x Short and Fidelity Sustainable Research 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.

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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.