Correlation Between Fidelity Covington and PHILIP
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By analyzing existing cross correlation between Fidelity Covington Trust and PHILIP MORRIS INTL, you can compare the effects of market volatilities on Fidelity Covington and PHILIP 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 PHILIP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Covington and PHILIP.
Diversification Opportunities for Fidelity Covington and PHILIP
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fidelity and PHILIP is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Covington Trust and PHILIP MORRIS INTL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PHILIP MORRIS INTL 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 PHILIP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PHILIP MORRIS INTL has no effect on the direction of Fidelity Covington i.e., Fidelity Covington and PHILIP go up and down completely randomly.
Pair Corralation between Fidelity Covington and PHILIP
Given the investment horizon of 90 days Fidelity Covington Trust is expected to generate 1.06 times more return on investment than PHILIP. However, Fidelity Covington is 1.06 times more volatile than PHILIP MORRIS INTL. It trades about 0.15 of its potential returns per unit of risk. PHILIP MORRIS INTL is currently generating about -0.13 per unit of risk. If you would invest 3,341 in Fidelity Covington Trust on September 23, 2024 and sell it today you would earn a total of 241.00 from holding Fidelity Covington Trust or generate 7.21% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 97.67% |
Values | Daily Returns |
Fidelity Covington Trust vs. PHILIP MORRIS INTL
Performance |
Timeline |
Fidelity Covington Trust |
PHILIP MORRIS INTL |
Fidelity Covington and PHILIP Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fidelity Covington and PHILIP
The main advantage of trading using opposite Fidelity Covington and PHILIP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Covington position performs unexpectedly, PHILIP 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 PHILIP will offset losses from the drop in PHILIP'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 |
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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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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