Correlation Between Aberdeen Global and Fidelity Advisor
Can any of the company-specific risk be diversified away by investing in both Aberdeen Global and Fidelity Advisor 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 Aberdeen Global and Fidelity Advisor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aberdeen Global Fixed and Fidelity Advisor Energy, you can compare the effects of market volatilities on Aberdeen Global and Fidelity Advisor 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 Aberdeen Global with a short position of Fidelity Advisor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberdeen Global and Fidelity Advisor.
Diversification Opportunities for Aberdeen Global and Fidelity Advisor
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Aberdeen and Fidelity is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Aberdeen Global Fixed and Fidelity Advisor Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Energy and Aberdeen Global 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 Aberdeen Global Fixed are associated (or correlated) with Fidelity Advisor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Advisor Energy has no effect on the direction of Aberdeen Global i.e., Aberdeen Global and Fidelity Advisor go up and down completely randomly.
Pair Corralation between Aberdeen Global and Fidelity Advisor
Assuming the 90 days horizon Aberdeen Global Fixed is expected to generate 0.17 times more return on investment than Fidelity Advisor. However, Aberdeen Global Fixed is 5.73 times less risky than Fidelity Advisor. It trades about 0.16 of its potential returns per unit of risk. Fidelity Advisor Energy is currently generating about 0.01 per unit of risk. If you would invest 834.00 in Aberdeen Global Fixed on September 1, 2024 and sell it today you would earn a total of 37.00 from holding Aberdeen Global Fixed or generate 4.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Aberdeen Global Fixed vs. Fidelity Advisor Energy
Performance |
| Timeline |
| Aberdeen Global Fixed |
| Fidelity Advisor Energy |
Aberdeen Global and Fidelity Advisor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aberdeen Global and Fidelity Advisor
The main advantage of trading using opposite Aberdeen Global and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aberdeen Global position performs unexpectedly, Fidelity Advisor 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 Fidelity Advisor will offset losses from the drop in Fidelity Advisor's long position.| Aberdeen Global vs. Aberdeen Emerging Markets | Aberdeen Global vs. Aberdeen Emerging Markets | Aberdeen Global vs. Aberdeen Emerging Markets | Aberdeen Global vs. Aberdeen Gbl Eq |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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