Correlation Between Loomis Sayles and Fidelity Series

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

By analyzing existing cross correlation between Loomis Sayles Global and Fidelity Series 1000, you can compare the effects of market volatilities on Loomis Sayles and Fidelity Series 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 Loomis Sayles with a short position of Fidelity Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loomis Sayles and Fidelity Series.

Diversification Opportunities for Loomis Sayles and Fidelity Series

0.3

Correlation Coefficient

Loomis Sayles  Fidelity Series

Weak diversification

The 3 months correlation between Loomis and Fidelity is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Loomis Sayles Global and Fidelity Series 1000 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Series 1000 and Loomis Sayles 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 Loomis Sayles Global are associated (or correlated) with Fidelity Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Series 1000 has no effect on the direction of Loomis Sayles i.e., Loomis Sayles and Fidelity Series go up and down completely randomly.

Pair Corralation between Loomis Sayles and Fidelity Series

Assuming the 90 days horizon Loomis Sayles is expected to generate 17.84 times less return on investment than Fidelity Series. But when comparing it to its historical volatility, Loomis Sayles Global is 1.8 times less risky than Fidelity Series. It trades about 0.01 of its potential returns per unit of risk. Fidelity Series 1000 is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  1,273  in Fidelity Series 1000 on October 5, 2024 and sell it today you would earn a total of  356.00  from holding Fidelity Series 1000 or generate 27.97% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	99.78%
Values	Daily Returns

Loomis Sayles Global  vs.  Fidelity Series 1000

Loomis Sayles Global

Risk-Adjusted Performance

0 of 100

Very Weak

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

Fidelity Series 1000

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fidelity Series 1000 has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Fidelity Series is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Loomis Sayles and Fidelity Series

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

The idea behind Loomis Sayles Global and Fidelity Series 1000 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.