Correlation Between Fidelity Advisor and Consumer Finance
Can any of the company-specific risk be diversified away by investing in both Fidelity Advisor and Consumer Finance 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 Advisor and Consumer Finance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Advisor Health and Consumer Finance Portfolio, you can compare the effects of market volatilities on Fidelity Advisor and Consumer Finance 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 Advisor with a short position of Consumer Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Advisor and Consumer Finance.
Diversification Opportunities for Fidelity Advisor and Consumer Finance
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fidelity and Consumer is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Advisor Health and Consumer Finance Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Consumer Finance Por and Fidelity Advisor 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 Advisor Health are associated (or correlated) with Consumer Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Consumer Finance Por has no effect on the direction of Fidelity Advisor i.e., Fidelity Advisor and Consumer Finance go up and down completely randomly.
Pair Corralation between Fidelity Advisor and Consumer Finance
Assuming the 90 days horizon Fidelity Advisor is expected to generate 2.68 times less return on investment than Consumer Finance. But when comparing it to its historical volatility, Fidelity Advisor Health is 1.31 times less risky than Consumer Finance. It trades about 0.09 of its potential returns per unit of risk. Consumer Finance Portfolio is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,566 in Consumer Finance Portfolio on September 1, 2024 and sell it today you would earn a total of 444.00 from holding Consumer Finance Portfolio or generate 28.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Fidelity Advisor Health vs. Consumer Finance Portfolio
Performance |
| Timeline |
| Fidelity Advisor Health |
| Consumer Finance Por |
Fidelity Advisor and Consumer Finance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Advisor and Consumer Finance
The main advantage of trading using opposite Fidelity Advisor and Consumer Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Advisor position performs unexpectedly, Consumer Finance 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 Consumer Finance will offset losses from the drop in Consumer Finance's long position.| Fidelity Advisor vs. Fidelity Freedom 2015 | Fidelity Advisor vs. Fidelity Puritan Fund | Fidelity Advisor vs. Fidelity Puritan Fund | Fidelity Advisor vs. Fidelity Pennsylvania Municipal |
| Consumer Finance vs. Banking Portfolio Banking | Consumer Finance vs. Insurance Portfolio Insurance | Consumer Finance vs. Financial Services Portfolio | Consumer Finance vs. Automotive Portfolio Automotive |
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.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Stocks Directory Find actively traded stocks across global markets | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |