Correlation Between Fidelity Sai and The Gabelli

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

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

Diversification Opportunities for Fidelity Sai and The Gabelli

0.41

Correlation Coefficient

Fidelity Sai  The Gabelli

Very weak diversification

The 3 months correlation between Fidelity and THE is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Sai Inflationfocused and The Gabelli Focus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Focus and Fidelity Sai 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 Sai Inflationfocused are associated (or correlated) with The Gabelli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Focus has no effect on the direction of Fidelity Sai i.e., Fidelity Sai and The Gabelli go up and down completely randomly.

Pair Corralation between Fidelity Sai and The Gabelli

Assuming the 90 days horizon Fidelity Sai Inflationfocused is expected to under-perform the The Gabelli. In addition to that, Fidelity Sai is 1.28 times more volatile than The Gabelli Focus. It trades about -0.07 of its total potential returns per unit of risk. The Gabelli Focus is currently generating about 0.52 per unit of volatility. If you would invest  1,340  in The Gabelli Focus on September 5, 2024 and sell it today you would earn a total of  107.00  from holding The Gabelli Focus or generate 7.99% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.45%
Values	Daily Returns

Fidelity Sai Inflationfocused  vs.  The Gabelli Focus

Fidelity Sai Inflati

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Sai Inflationfocused are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Fidelity Sai is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Gabelli Focus

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in The Gabelli Focus are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, The Gabelli may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Fidelity Sai and The Gabelli

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

The idea behind Fidelity Sai Inflationfocused and The Gabelli Focus 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.