Correlation Between Fidelity Advisor and Federated Kaufmann
Can any of the company-specific risk be diversified away by investing in both Fidelity Advisor and Federated Kaufmann 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 Federated Kaufmann into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Advisor Growth and Federated Kaufmann Small, you can compare the effects of market volatilities on Fidelity Advisor and Federated Kaufmann 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 Federated Kaufmann. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Advisor and Federated Kaufmann.
Diversification Opportunities for Fidelity Advisor and Federated Kaufmann
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Fidelity and Federated is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Advisor Growth and Federated Kaufmann Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Kaufmann Small 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 Growth are associated (or correlated) with Federated Kaufmann. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Kaufmann Small has no effect on the direction of Fidelity Advisor i.e., Fidelity Advisor and Federated Kaufmann go up and down completely randomly.
Pair Corralation between Fidelity Advisor and Federated Kaufmann
Assuming the 90 days horizon Fidelity Advisor Growth is expected to under-perform the Federated Kaufmann. In addition to that, Fidelity Advisor is 1.1 times more volatile than Federated Kaufmann Small. It trades about -0.07 of its total potential returns per unit of risk. Federated Kaufmann Small is currently generating about -0.07 per unit of volatility. If you would invest 4,435 in Federated Kaufmann Small on January 17, 2025 and sell it today you would lose (257.00) from holding Federated Kaufmann Small or give up 5.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Advisor Growth vs. Federated Kaufmann Small
Performance |
| Timeline |
| Fidelity Advisor Growth |
| Federated Kaufmann Small |
Fidelity Advisor and Federated Kaufmann Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Advisor and Federated Kaufmann
The main advantage of trading using opposite Fidelity Advisor and Federated Kaufmann positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Advisor position performs unexpectedly, Federated Kaufmann 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 Federated Kaufmann will offset losses from the drop in Federated Kaufmann's long position.| Fidelity Advisor vs. T Rowe Price | Fidelity Advisor vs. Ab International Growth | Fidelity Advisor vs. Growth Allocation Fund | Fidelity Advisor vs. Rational Defensive Growth |
| Federated Kaufmann vs. Ab Global Bond | Federated Kaufmann vs. Us Government Securities | Federated Kaufmann vs. Flexible Bond Portfolio | Federated Kaufmann vs. Ab Bond Inflation |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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