Correlation Between Pace High and Fidelity Contrafund
Can any of the company-specific risk be diversified away by investing in both Pace High and Fidelity Contrafund 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 Pace High and Fidelity Contrafund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pace High Yield and Fidelity Contrafund K6, you can compare the effects of market volatilities on Pace High and Fidelity Contrafund 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 Pace High with a short position of Fidelity Contrafund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pace High and Fidelity Contrafund.
Diversification Opportunities for Pace High and Fidelity Contrafund
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pace and Fidelity is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Pace High Yield and Fidelity Contrafund K6 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Contrafund and Pace High 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 Pace High Yield are associated (or correlated) with Fidelity Contrafund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Contrafund has no effect on the direction of Pace High i.e., Pace High and Fidelity Contrafund go up and down completely randomly.
Pair Corralation between Pace High and Fidelity Contrafund
Assuming the 90 days horizon Pace High Yield is expected to generate 0.16 times more return on investment than Fidelity Contrafund. However, Pace High Yield is 6.21 times less risky than Fidelity Contrafund. It trades about -0.28 of its potential returns per unit of risk. Fidelity Contrafund K6 is currently generating about -0.05 per unit of risk. If you would invest 903.00 in Pace High Yield on October 10, 2024 and sell it today you would lose (9.00) from holding Pace High Yield or give up 1.0% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Pace High Yield vs. Fidelity Contrafund K6
Performance |
Timeline |
Pace High Yield |
Fidelity Contrafund |
Pace High and Fidelity Contrafund Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Pace High and Fidelity Contrafund
The main advantage of trading using opposite Pace High and Fidelity Contrafund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pace High position performs unexpectedly, Fidelity Contrafund 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 Contrafund will offset losses from the drop in Fidelity Contrafund's long position.Pace High vs. Firsthand Alternative Energy | Pace High vs. Tortoise Energy Independence | Pace High vs. Thrivent Natural Resources | Pace High vs. Salient Mlp Energy |
Fidelity Contrafund vs. Virtus High Yield | Fidelity Contrafund vs. Inverse High Yield | Fidelity Contrafund vs. Voya High Yield | Fidelity Contrafund vs. Tiaa Cref High Yield Fund |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
CEOs Directory Screen CEOs from public companies around the world | |
Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
Stocks Directory Find actively traded stocks across global markets |