Correlation Between Chesapeake Granite and Fidelity Active

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

By analyzing existing cross correlation between Chesapeake Granite Wash and Fidelity Active Strategy, you can compare the effects of market volatilities on Chesapeake Granite and Fidelity Active 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 Chesapeake Granite with a short position of Fidelity Active. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chesapeake Granite and Fidelity Active.

Diversification Opportunities for Chesapeake Granite and Fidelity Active

0.0

Correlation Coefficient

Chesapeake Granite  Fidelity Active

Pay attention - limited upside

The 3 months correlation between Chesapeake and Fidelity is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Chesapeake Granite Wash and Fidelity Active Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Active Strategy and Chesapeake Granite 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 Chesapeake Granite Wash are associated (or correlated) with Fidelity Active. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Active Strategy has no effect on the direction of Chesapeake Granite i.e., Chesapeake Granite and Fidelity Active go up and down completely randomly.

Pair Corralation between Chesapeake Granite and Fidelity Active

If you would invest (100.00) in Fidelity Active Strategy on October 6, 2024 and sell it today you would earn a total of  100.00  from holding Fidelity Active Strategy or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Chesapeake Granite Wash  vs.  Fidelity Active Strategy

Chesapeake Granite Wash

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Chesapeake Granite Wash has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable forward-looking signals, Chesapeake Granite is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Fidelity Active Strategy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fidelity Active Strategy has generated negative risk-adjusted returns adding no value to fund investors. In spite of comparatively stable basic indicators, Fidelity Active 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 Chesapeake Granite and Fidelity Active

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

The idea behind Chesapeake Granite Wash and Fidelity Active Strategy 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.