Correlation Between Cmg Ultra and Fidelity Sai

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

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

Diversification Opportunities for Cmg Ultra and Fidelity Sai

0.85

Correlation Coefficient

Cmg Ultra  Fidelity Sai

Very poor diversification

The 3 months correlation between Cmg and Fidelity is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Cmg Ultra Short and Fidelity Sai Short Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Sai Short and Cmg Ultra 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 Cmg Ultra Short are associated (or correlated) with Fidelity Sai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Sai Short has no effect on the direction of Cmg Ultra i.e., Cmg Ultra and Fidelity Sai go up and down completely randomly.

Pair Corralation between Cmg Ultra and Fidelity Sai

Assuming the 90 days horizon Cmg Ultra Short is expected to generate 0.88 times more return on investment than Fidelity Sai. However, Cmg Ultra Short is 1.14 times less risky than Fidelity Sai. It trades about 0.25 of its potential returns per unit of risk. Fidelity Sai Short Term is currently generating about 0.17 per unit of risk. If you would invest  918.00  in Cmg Ultra Short on October 21, 2024 and sell it today you would earn a total of  9.00  from holding Cmg Ultra Short or generate 0.98% return on investment over 90 days.

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

Cmg Ultra Short  vs.  Fidelity Sai Short Term

Cmg Ultra Short

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Cmg Ultra Short are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Cmg Ultra is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Fidelity Sai Short

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Sai Short Term are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong primary indicators, Fidelity Sai is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Cmg Ultra and Fidelity Sai

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

The idea behind Cmg Ultra Short and Fidelity Sai Short Term 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.