Correlation Between Ultramid-cap Profund and Fidelity Freedom
Can any of the company-specific risk be diversified away by investing in both Ultramid-cap Profund 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 Ultramid-cap Profund and Fidelity Freedom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ultramid Cap Profund Ultramid Cap and Fidelity Freedom Blend, you can compare the effects of market volatilities on Ultramid-cap Profund 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 Ultramid-cap Profund with a short position of Fidelity Freedom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ultramid-cap Profund and Fidelity Freedom.
Diversification Opportunities for Ultramid-cap Profund and Fidelity Freedom
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ultramid-cap and Fidelity is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Ultramid Cap Profund Ultramid and Fidelity Freedom Blend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Freedom Blend and Ultramid-cap Profund 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 Ultramid Cap Profund Ultramid Cap 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 Blend has no effect on the direction of Ultramid-cap Profund i.e., Ultramid-cap Profund and Fidelity Freedom go up and down completely randomly.
Pair Corralation between Ultramid-cap Profund and Fidelity Freedom
Assuming the 90 days horizon Ultramid-cap Profund is expected to generate 3.29 times less return on investment than Fidelity Freedom. In addition to that, Ultramid-cap Profund is 2.79 times more volatile than Fidelity Freedom Blend. It trades about 0.01 of its total potential returns per unit of risk. Fidelity Freedom Blend is currently generating about 0.09 per unit of volatility. If you would invest 1,179 in Fidelity Freedom Blend on September 6, 2025 and sell it today you would earn a total of 46.00 from holding Fidelity Freedom Blend or generate 3.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.44% |
| Values | Daily Returns |
Ultramid Cap Profund Ultramid vs. Fidelity Freedom Blend
Performance |
| Timeline |
| Ultramid Cap Profund |
| Fidelity Freedom Blend |
Ultramid-cap Profund and Fidelity Freedom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ultramid-cap Profund and Fidelity Freedom
The main advantage of trading using opposite Ultramid-cap Profund and Fidelity Freedom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ultramid-cap Profund 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 idea behind Ultramid Cap Profund Ultramid Cap and Fidelity Freedom Blend 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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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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