Correlation Between Fidelity Advisor and Aggressive Growth
Can any of the company-specific risk be diversified away by investing in both Fidelity Advisor and Aggressive Growth 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 Aggressive Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Advisor Equity and Aggressive Growth Allocation, you can compare the effects of market volatilities on Fidelity Advisor and Aggressive Growth 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 Aggressive Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Advisor and Aggressive Growth.
Diversification Opportunities for Fidelity Advisor and Aggressive Growth
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fidelity and Aggressive is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Advisor Equity and Aggressive Growth Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aggressive Growth 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 Equity are associated (or correlated) with Aggressive Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aggressive Growth has no effect on the direction of Fidelity Advisor i.e., Fidelity Advisor and Aggressive Growth go up and down completely randomly.
Pair Corralation between Fidelity Advisor and Aggressive Growth
Assuming the 90 days horizon Fidelity Advisor Equity is expected to generate 1.29 times more return on investment than Aggressive Growth. However, Fidelity Advisor is 1.29 times more volatile than Aggressive Growth Allocation. It trades about 0.32 of its potential returns per unit of risk. Aggressive Growth Allocation is currently generating about 0.35 per unit of risk. If you would invest 2,529 in Fidelity Advisor Equity on September 5, 2024 and sell it today you would earn a total of 118.00 from holding Fidelity Advisor Equity or generate 4.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Advisor Equity vs. Aggressive Growth Allocation
Performance |
| Timeline |
| Fidelity Advisor Equity |
| Aggressive Growth |
Fidelity Advisor and Aggressive Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Advisor and Aggressive Growth
The main advantage of trading using opposite Fidelity Advisor and Aggressive Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Advisor position performs unexpectedly, Aggressive Growth 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 Aggressive Growth will offset losses from the drop in Aggressive Growth'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 |
| Aggressive Growth vs. Needham Aggressive Growth | Aggressive Growth vs. Guggenheim High Yield | Aggressive Growth vs. Pioneer High Yield | Aggressive Growth vs. T Rowe Price |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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