Correlation Between Fidelity Intermediate and Tax Exempt
Can any of the company-specific risk be diversified away by investing in both Fidelity Intermediate and Tax Exempt 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 Intermediate and Tax Exempt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Intermediate Municipal and Tax Exempt Bond Fund, you can compare the effects of market volatilities on Fidelity Intermediate and Tax Exempt 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 Intermediate with a short position of Tax Exempt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Intermediate and Tax Exempt.
Diversification Opportunities for Fidelity Intermediate and Tax Exempt
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fidelity and Tax is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Intermediate Municipa and Tax Exempt Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tax Exempt Bond and Fidelity Intermediate 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 Intermediate Municipal are associated (or correlated) with Tax Exempt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tax Exempt Bond has no effect on the direction of Fidelity Intermediate i.e., Fidelity Intermediate and Tax Exempt go up and down completely randomly.
Pair Corralation between Fidelity Intermediate and Tax Exempt
If you would invest 947.00 in Fidelity Intermediate Municipal on January 19, 2024 and sell it today you would earn a total of 56.00 from holding Fidelity Intermediate Municipal or generate 5.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Fidelity Intermediate Municipa vs. Tax Exempt Bond Fund
Performance |
| Timeline |
| Fidelity Intermediate |
| Tax Exempt Bond |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Fidelity Intermediate and Tax Exempt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Intermediate and Tax Exempt
The main advantage of trading using opposite Fidelity Intermediate and Tax Exempt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Intermediate position performs unexpectedly, Tax Exempt 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 Tax Exempt will offset losses from the drop in Tax Exempt's long position.The idea behind Fidelity Intermediate Municipal and Tax Exempt Bond Fund 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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