Correlation Between The Emerging and Fidelity Freedom
Can any of the company-specific risk be diversified away by investing in both The Emerging and Fidelity Freedom 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 The Emerging and Fidelity Freedom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Emerging Markets and Fidelity Freedom 2035, you can compare the effects of market volatilities on The Emerging and Fidelity Freedom 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 The Emerging with a short position of Fidelity Freedom. Check out your portfolio center. Please also check ongoing floating volatility patterns of The Emerging and Fidelity Freedom.
Diversification Opportunities for The Emerging and Fidelity Freedom
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between The and Fidelity is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding The Emerging Markets and Fidelity Freedom 2035 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Freedom 2035 and The Emerging 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 The Emerging Markets are associated (or correlated) with Fidelity Freedom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Freedom 2035 has no effect on the direction of The Emerging i.e., The Emerging and Fidelity Freedom go up and down completely randomly.
Pair Corralation between The Emerging and Fidelity Freedom
Assuming the 90 days horizon The Emerging Markets is expected to generate 1.52 times more return on investment than Fidelity Freedom. However, The Emerging is 1.52 times more volatile than Fidelity Freedom 2035. It trades about 0.26 of its potential returns per unit of risk. Fidelity Freedom 2035 is currently generating about 0.25 per unit of risk. If you would invest 1,958 in The Emerging Markets on May 28, 2025 and sell it today you would earn a total of 222.00 from holding The Emerging Markets or generate 11.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Emerging Markets vs. Fidelity Freedom 2035
Performance |
| Timeline |
| Emerging Markets |
| Fidelity Freedom 2035 |
The Emerging and Fidelity Freedom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with The Emerging and Fidelity Freedom
The main advantage of trading using opposite The Emerging and Fidelity Freedom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if The Emerging position performs unexpectedly, Fidelity Freedom 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 Freedom will offset losses from the drop in Fidelity Freedom's long position.| The Emerging vs. Vanguard Total Stock | The Emerging vs. Vanguard 500 Index | The Emerging vs. Vanguard Total Stock | The Emerging vs. Vanguard Total Stock |
| Fidelity Freedom vs. Guidemark Large Cap | Fidelity Freedom vs. Qs Large Cap | Fidelity Freedom vs. Tfa Alphagen Growth | Fidelity Freedom vs. T Rowe Price |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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