Correlation Between Fidelity Advisor and Nasdaq-100(r)
Can any of the company-specific risk be diversified away by investing in both Fidelity Advisor and Nasdaq-100(r) 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 Nasdaq-100(r) 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 Nasdaq 100 2x Strategy, you can compare the effects of market volatilities on Fidelity Advisor and Nasdaq-100(r) 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 Nasdaq-100(r). Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Advisor and Nasdaq-100(r).
Diversification Opportunities for Fidelity Advisor and Nasdaq-100(r)
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Fidelity and Nasdaq-100(r) is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Advisor Gold and Nasdaq 100 2x Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq 100 2x 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 Nasdaq-100(r). Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq 100 2x has no effect on the direction of Fidelity Advisor i.e., Fidelity Advisor and Nasdaq-100(r) go up and down completely randomly.
Pair Corralation between Fidelity Advisor and Nasdaq-100(r)
Assuming the 90 days horizon Fidelity Advisor is expected to generate 3.53 times less return on investment than Nasdaq-100(r). But when comparing it to its historical volatility, Fidelity Advisor Gold is 1.32 times less risky than Nasdaq-100(r). It trades about 0.03 of its potential returns per unit of risk. Nasdaq 100 2x Strategy is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 17,213 in Nasdaq 100 2x Strategy on November 1, 2024 and sell it today you would earn a total of 22,634 from holding Nasdaq 100 2x Strategy or generate 131.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Advisor Gold vs. Nasdaq 100 2x Strategy
Performance |
| Timeline |
| Fidelity Advisor Gold |
| Nasdaq 100 2x |
Fidelity Advisor and Nasdaq-100(r) Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Advisor and Nasdaq-100(r)
The main advantage of trading using opposite Fidelity Advisor and Nasdaq-100(r) positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Advisor position performs unexpectedly, Nasdaq-100(r) 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 Nasdaq-100(r) will offset losses from the drop in Nasdaq-100(r)'s long position.| Fidelity Advisor vs. Columbia Global Technology | Fidelity Advisor vs. Specialized Technology Fund | Fidelity Advisor vs. Fidelity Advisor Technology | Fidelity Advisor vs. Global Technology Portfolio |
| Nasdaq-100(r) vs. Goldman Sachs Strategic | Nasdaq-100(r) vs. Global Gold Fund | Nasdaq-100(r) vs. Fidelity Advisor Gold | Nasdaq-100(r) vs. James Balanced Golden |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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