Correlation Between Fidelity Small and Centerstone Investors
Can any of the company-specific risk be diversified away by investing in both Fidelity Small and Centerstone Investors 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 Small and Centerstone Investors into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Small Cap and Centerstone Investors Fund, you can compare the effects of market volatilities on Fidelity Small and Centerstone Investors 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 Small with a short position of Centerstone Investors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Small and Centerstone Investors.
Diversification Opportunities for Fidelity Small and Centerstone Investors
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Fidelity and Centerstone is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Small Cap and Centerstone Investors Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Centerstone Investors and Fidelity Small 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 Small Cap are associated (or correlated) with Centerstone Investors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Centerstone Investors has no effect on the direction of Fidelity Small i.e., Fidelity Small and Centerstone Investors go up and down completely randomly.
Pair Corralation between Fidelity Small and Centerstone Investors
Assuming the 90 days horizon Fidelity Small Cap is expected to generate 2.02 times more return on investment than Centerstone Investors. However, Fidelity Small is 2.02 times more volatile than Centerstone Investors Fund. It trades about 0.12 of its potential returns per unit of risk. Centerstone Investors Fund is currently generating about 0.11 per unit of risk. If you would invest 2,085 in Fidelity Small Cap on May 28, 2025 and sell it today you would earn a total of 71.00 from holding Fidelity Small Cap or generate 3.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Small Cap vs. Centerstone Investors Fund
Performance |
| Timeline |
| Fidelity Small Cap |
| Centerstone Investors |
Fidelity Small and Centerstone Investors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Small and Centerstone Investors
The main advantage of trading using opposite Fidelity Small and Centerstone Investors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Small position performs unexpectedly, Centerstone Investors 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 Centerstone Investors will offset losses from the drop in Centerstone Investors' long position.| Fidelity Small vs. Fidelity Small Cap | Fidelity Small vs. Fidelity Small Cap | Fidelity Small vs. Fidelity Mid Cap | Fidelity Small vs. Fidelity Advisor Value |
| Centerstone Investors vs. Rbb Fund | Centerstone Investors vs. Growth Allocation Fund | Centerstone Investors vs. Eic Value Fund | Centerstone Investors vs. Gmo Quality 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 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.
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