Correlation Between Vanguard and Fidelity MSCI
Can any of the company-specific risk be diversified away by investing in both Vanguard and Fidelity MSCI 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 Vanguard and Fidelity MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard SP 500 and Fidelity MSCI Financials, you can compare the effects of market volatilities on Vanguard and Fidelity MSCI 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 Vanguard with a short position of Fidelity MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard and Fidelity MSCI.
Diversification Opportunities for Vanguard and Fidelity MSCI
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Vanguard and Fidelity is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard SP 500 and Fidelity MSCI Financials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity MSCI Financials and Vanguard 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 Vanguard SP 500 are associated (or correlated) with Fidelity MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity MSCI Financials has no effect on the direction of Vanguard i.e., Vanguard and Fidelity MSCI go up and down completely randomly.
Pair Corralation between Vanguard and Fidelity MSCI
Considering the 90-day investment horizon Vanguard SP 500 is expected to generate 0.83 times more return on investment than Fidelity MSCI. However, Vanguard SP 500 is 1.2 times less risky than Fidelity MSCI. It trades about 0.11 of its potential returns per unit of risk. Fidelity MSCI Financials is currently generating about 0.02 per unit of risk. If you would invest 58,988 in Vanguard SP 500 on August 15, 2025 and sell it today you would earn a total of 2,811 from holding Vanguard SP 500 or generate 4.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard SP 500 vs. Fidelity MSCI Financials
Performance |
| Timeline |
| Vanguard SP 500 |
| Fidelity MSCI Financials |
Vanguard and Fidelity MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard and Fidelity MSCI
The main advantage of trading using opposite Vanguard and Fidelity MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard position performs unexpectedly, Fidelity MSCI 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 MSCI will offset losses from the drop in Fidelity MSCI's long position.| Vanguard vs. Vanguard Institutional Index | Vanguard vs. Vanguard Growth Index | Vanguard vs. Vanguard Growth Index | Vanguard vs. Vanguard Mid Cap Index |
| Fidelity MSCI vs. Fidelity MSCI Health | Fidelity MSCI vs. Fidelity MSCI Utilities | Fidelity MSCI vs. Fidelity MSCI Consumer | Fidelity MSCI vs. iShares MSCI USA |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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