Correlation Between Dana Small and Fidelity Advisor
Can any of the company-specific risk be diversified away by investing in both Dana Small 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 Dana Small and Fidelity Advisor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dana Small Cap and Fidelity Advisor Industrials, you can compare the effects of market volatilities on Dana Small 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 Dana Small with a short position of Fidelity Advisor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dana Small and Fidelity Advisor.
Diversification Opportunities for Dana Small and Fidelity Advisor
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dana and Fidelity is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Dana Small Cap and Fidelity Advisor Industrials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Ind and Dana Small 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 Dana Small Cap 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 Ind has no effect on the direction of Dana Small i.e., Dana Small and Fidelity Advisor go up and down completely randomly.
Pair Corralation between Dana Small and Fidelity Advisor
Assuming the 90 days horizon Dana Small is expected to generate 1.17 times less return on investment than Fidelity Advisor. In addition to that, Dana Small is 1.04 times more volatile than Fidelity Advisor Industrials. It trades about 0.06 of its total potential returns per unit of risk. Fidelity Advisor Industrials is currently generating about 0.07 per unit of volatility. If you would invest 2,802 in Fidelity Advisor Industrials on September 12, 2024 and sell it today you would earn a total of 1,250 from holding Fidelity Advisor Industrials or generate 44.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dana Small Cap vs. Fidelity Advisor Industrials
Performance |
| Timeline |
| Dana Small Cap |
| Fidelity Advisor Ind |
Dana Small and Fidelity Advisor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dana Small and Fidelity Advisor
The main advantage of trading using opposite Dana Small and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dana Small 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.| Dana Small vs. Hennessy Technology Fund | Dana Small vs. Janus Global Technology | Dana Small vs. Firsthand Technology Opportunities | Dana Small vs. Red Oak Technology |
| Fidelity Advisor vs. Upright Assets Allocation | Fidelity Advisor vs. Rational Strategic Allocation | Fidelity Advisor vs. Alternative Asset Allocation | Fidelity Advisor vs. Jhancock Disciplined Value |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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