Correlation Between Fidelity International and Janus Henderson

Can any of the company-specific risk be diversified away by investing in both Fidelity International and Janus Henderson 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 International and Janus Henderson into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fidelity International Growth and Janus Henderson Global, you can compare the effects of market volatilities on Fidelity International and Janus Henderson 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 International with a short position of Janus Henderson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity International and Janus Henderson.

Diversification Opportunities for Fidelity International and Janus Henderson

0.65

Correlation Coefficient

Fidelity International  Janus Henderson

Poor diversification

The 3 months correlation between Fidelity and Janus is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity International Growth and Janus Henderson Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus Henderson Global and Fidelity International 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 International Growth are associated (or correlated) with Janus Henderson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus Henderson Global has no effect on the direction of Fidelity International i.e., Fidelity International and Janus Henderson go up and down completely randomly.

Pair Corralation between Fidelity International and Janus Henderson

Assuming the 90 days horizon Fidelity International Growth is expected to generate 1.29 times more return on investment than Janus Henderson. However, Fidelity International is 1.29 times more volatile than Janus Henderson Global. It trades about 0.07 of its potential returns per unit of risk. Janus Henderson Global is currently generating about 0.05 per unit of risk. If you would invest  1,587  in Fidelity International Growth on September 14, 2024 and sell it today you would earn a total of  524.00  from holding Fidelity International Growth or generate 33.02% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Fidelity International Growth  vs.  Janus Henderson Global

Fidelity International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fidelity International Growth has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Fidelity International is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Janus Henderson Global

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Janus Henderson Global has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Janus Henderson is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Fidelity International and Janus Henderson

The main advantage of trading using opposite Fidelity International and Janus Henderson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity International position performs unexpectedly, Janus Henderson 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 Janus Henderson will offset losses from the drop in Janus Henderson's long position.

The idea behind Fidelity International Growth and Janus Henderson Global 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.