Correlation Between Fidelity Intermediate and Gurtin National

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

By analyzing existing cross correlation between Fidelity Intermediate Municipal and Gurtin National Municipal, you can compare the effects of market volatilities on Fidelity Intermediate and Gurtin National 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 Intermediate with a short position of Gurtin National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Intermediate and Gurtin National.

Diversification Opportunities for Fidelity Intermediate and Gurtin National

0.97

Correlation Coefficient

Fidelity Intermediate  Gurtin National

Almost no diversification

The 3 months correlation between Fidelity and Gurtin is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Intermediate Municipa and Gurtin National Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gurtin National Municipal and Fidelity Intermediate 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 Intermediate Municipal are associated (or correlated) with Gurtin National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gurtin National Municipal has no effect on the direction of Fidelity Intermediate i.e., Fidelity Intermediate and Gurtin National go up and down completely randomly.

Pair Corralation between Fidelity Intermediate and Gurtin National

Assuming the 90 days horizon Fidelity Intermediate is expected to generate 1.19 times less return on investment than Gurtin National. But when comparing it to its historical volatility, Fidelity Intermediate Municipal is 1.1 times less risky than Gurtin National. It trades about 0.05 of its potential returns per unit of risk. Gurtin National Municipal is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  928.00  in Gurtin National Municipal on October 11, 2024 and sell it today you would earn a total of  47.00  from holding Gurtin National Municipal or generate 5.06% return on investment over 90 days.

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

Fidelity Intermediate Municipa  vs.  Gurtin National Municipal

Fidelity Intermediate

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fidelity Intermediate Municipal has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong primary indicators, Fidelity Intermediate is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Gurtin National Municipal

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gurtin National Municipal has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Gurtin National is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Fidelity Intermediate and Gurtin National

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

The idea behind Fidelity Intermediate Municipal and Gurtin National Municipal 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.