Correlation Between Fidelity Blue and Fidelity Growth

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Can any of the company-specific risk be diversified away by investing in both Fidelity Blue and Fidelity Growth 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 Blue and Fidelity Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Blue Chip and Fidelity Growth Opportunities, you can compare the effects of market volatilities on Fidelity Blue and Fidelity Growth 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 Blue with a short position of Fidelity Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Blue and Fidelity Growth.

Diversification Opportunities for Fidelity Blue and Fidelity Growth

FidelityFidelityDiversified AwayFidelityFidelityDiversified Away100%
0.0
  Correlation Coefficient

Pay attention - limited upside

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

Pair Corralation between Fidelity Blue and Fidelity Growth

If you would invest  4,132  in Fidelity Blue Chip on September 15, 2024 and sell it today you would earn a total of  642.00  from holding Fidelity Blue Chip or generate 15.54% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy1.56%
ValuesDaily Returns

Fidelity Blue Chip  vs.  Fidelity Growth Opportunities

 Performance 
JavaScript chart by amCharts 3.21.15OctNov 51015
JavaScript chart by amCharts 3.21.15FBCG FGRO
       Timeline  
Fidelity Blue Chip 

Risk-Adjusted Performance

17 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Blue Chip are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile fundamental indicators, Fidelity Blue reported solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec42434445464748
Fidelity Growth Oppo 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Fidelity Growth Opportunities has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Fidelity Growth is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Fidelity Blue and Fidelity Growth Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-3.04-2.28-1.51-0.750.01270.851.712.563.42 0.050.100.150.200.250.300.35
JavaScript chart by amCharts 3.21.15FBCG FGRO
       Returns  

Pair Trading with Fidelity Blue and Fidelity Growth

The main advantage of trading using opposite Fidelity Blue and Fidelity Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Blue position performs unexpectedly, Fidelity Growth 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 Growth will offset losses from the drop in Fidelity Growth's long position.
The idea behind Fidelity Blue Chip and Fidelity Growth Opportunities 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.

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