Correlation Between Fidelity 500 and Indie Semiconductor

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Fidelity 500 and Indie Semiconductor 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 500 and Indie Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity 500 Index and indie Semiconductor, you can compare the effects of market volatilities on Fidelity 500 and Indie Semiconductor 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 500 with a short position of Indie Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity 500 and Indie Semiconductor.

Diversification Opportunities for Fidelity 500 and Indie Semiconductor

-0.03
  Correlation Coefficient

Good diversification

The 3 months correlation between Fidelity and Indie is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity 500 Index and indie Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on indie Semiconductor and Fidelity 500 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 500 Index are associated (or correlated) with Indie Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of indie Semiconductor has no effect on the direction of Fidelity 500 i.e., Fidelity 500 and Indie Semiconductor go up and down completely randomly.

Pair Corralation between Fidelity 500 and Indie Semiconductor

Assuming the 90 days horizon Fidelity 500 Index is expected to generate 0.16 times more return on investment than Indie Semiconductor. However, Fidelity 500 Index is 6.14 times less risky than Indie Semiconductor. It trades about -0.15 of its potential returns per unit of risk. indie Semiconductor is currently generating about -0.12 per unit of risk. If you would invest  18,060  in Fidelity 500 Index on January 26, 2024 and sell it today you would lose (443.00) from holding Fidelity 500 Index or give up 2.45% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Fidelity 500 Index  vs.  indie Semiconductor

 Performance 
       Timeline  
Fidelity 500 Index 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity 500 Index are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Fidelity 500 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
indie Semiconductor 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days indie Semiconductor has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Stock's fundamental indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Fidelity 500 and Indie Semiconductor Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Fidelity 500 and Indie Semiconductor

The main advantage of trading using opposite Fidelity 500 and Indie Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity 500 position performs unexpectedly, Indie Semiconductor 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 Indie Semiconductor will offset losses from the drop in Indie Semiconductor's long position.
The idea behind Fidelity 500 Index and indie Semiconductor 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.
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.

Other Complementary Tools

Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
AI Portfolio Architect
Use AI to generate optimal portfolios and find profitable investment opportunities
Portfolio Comparator
Compare the composition, asset allocations and performance of any two portfolios in your account
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Financial Widgets
Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets
Portfolio Suggestion
Get suggestions outside of your existing asset allocation including your own model portfolios
Cryptocurrency Center
Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Economic Indicators
Top statistical indicators that provide insights into how an economy is performing