Correlation Between Fidelity Covington and NORFOLK
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By analyzing existing cross correlation between Fidelity Covington Trust and NORFOLK SOUTHN P, you can compare the effects of market volatilities on Fidelity Covington and NORFOLK 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 Covington with a short position of NORFOLK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Covington and NORFOLK.
Diversification Opportunities for Fidelity Covington and NORFOLK
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fidelity and NORFOLK is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Covington Trust and NORFOLK SOUTHN P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NORFOLK SOUTHN P and Fidelity Covington 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 Covington Trust are associated (or correlated) with NORFOLK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NORFOLK SOUTHN P has no effect on the direction of Fidelity Covington i.e., Fidelity Covington and NORFOLK go up and down completely randomly.
Pair Corralation between Fidelity Covington and NORFOLK
Given the investment horizon of 90 days Fidelity Covington Trust is expected to generate 0.38 times more return on investment than NORFOLK. However, Fidelity Covington Trust is 2.65 times less risky than NORFOLK. It trades about 0.14 of its potential returns per unit of risk. NORFOLK SOUTHN P is currently generating about -0.02 per unit of risk. If you would invest 3,282 in Fidelity Covington Trust on September 23, 2024 and sell it today you would earn a total of 300.00 from holding Fidelity Covington Trust or generate 9.14% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 64.62% |
Values | Daily Returns |
Fidelity Covington Trust vs. NORFOLK SOUTHN P
Performance |
Timeline |
Fidelity Covington Trust |
NORFOLK SOUTHN P |
Fidelity Covington and NORFOLK Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fidelity Covington and NORFOLK
The main advantage of trading using opposite Fidelity Covington and NORFOLK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Covington position performs unexpectedly, NORFOLK 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 NORFOLK will offset losses from the drop in NORFOLK's long position.Fidelity Covington vs. Vanguard Growth Index | Fidelity Covington vs. iShares Russell 1000 | Fidelity Covington vs. iShares SP 500 | Fidelity Covington vs. SPDR Portfolio SP |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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