Correlation Between Fidelity Advisor and Old Westbury
Can any of the company-specific risk be diversified away by investing in both Fidelity Advisor and Old Westbury 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 Old Westbury into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Advisor Gold and Old Westbury Municipal, you can compare the effects of market volatilities on Fidelity Advisor and Old Westbury 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 Old Westbury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Advisor and Old Westbury.
Diversification Opportunities for Fidelity Advisor and Old Westbury
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Fidelity and Old is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Advisor Gold and Old Westbury Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Westbury Municipal 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 Gold are associated (or correlated) with Old Westbury. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Westbury Municipal has no effect on the direction of Fidelity Advisor i.e., Fidelity Advisor and Old Westbury go up and down completely randomly.
Pair Corralation between Fidelity Advisor and Old Westbury
Assuming the 90 days horizon Fidelity Advisor Gold is expected to generate 9.64 times more return on investment than Old Westbury. However, Fidelity Advisor is 9.64 times more volatile than Old Westbury Municipal. It trades about 0.04 of its potential returns per unit of risk. Old Westbury Municipal is currently generating about 0.03 per unit of risk. If you would invest 2,507 in Fidelity Advisor Gold on October 25, 2024 and sell it today you would earn a total of 194.00 from holding Fidelity Advisor Gold or generate 7.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Advisor Gold vs. Old Westbury Municipal
Performance |
| Timeline |
| Fidelity Advisor Gold |
| Old Westbury Municipal |
Fidelity Advisor and Old Westbury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Advisor and Old Westbury
The main advantage of trading using opposite Fidelity Advisor and Old Westbury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Advisor position performs unexpectedly, Old Westbury 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 Old Westbury will offset losses from the drop in Old Westbury's long position.| Fidelity Advisor vs. Firsthand Technology Opportunities | Fidelity Advisor vs. Towpath Technology | Fidelity Advisor vs. Technology Ultrasector Profund | Fidelity Advisor vs. Dreyfus Technology Growth |
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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