Correlation Between Franklin High and Fidelity Advisor
Can any of the company-specific risk be diversified away by investing in both Franklin High and Fidelity Advisor 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 Franklin High and Fidelity Advisor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin High Income and Fidelity Advisor Strategic, you can compare the effects of market volatilities on Franklin High and Fidelity Advisor 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 Franklin High with a short position of Fidelity Advisor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin High and Fidelity Advisor.
Diversification Opportunities for Franklin High and Fidelity Advisor
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Franklin and Fidelity is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Franklin High Income and Fidelity Advisor Strategic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Str and Franklin High 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 Franklin High Income are associated (or correlated) with Fidelity Advisor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Advisor Str has no effect on the direction of Franklin High i.e., Franklin High and Fidelity Advisor go up and down completely randomly.
Pair Corralation between Franklin High and Fidelity Advisor
Assuming the 90 days horizon Franklin High is expected to generate 168.67 times less return on investment than Fidelity Advisor. In addition to that, Franklin High is 1.25 times more volatile than Fidelity Advisor Strategic. It trades about 0.0 of its total potential returns per unit of risk. Fidelity Advisor Strategic is currently generating about 0.25 per unit of volatility. If you would invest 1,165 in Fidelity Advisor Strategic on August 31, 2024 and sell it today you would earn a total of 13.00 from holding Fidelity Advisor Strategic or generate 1.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin High Income vs. Fidelity Advisor Strategic
Performance |
| Timeline |
| Franklin High Income |
| Fidelity Advisor Str |
Franklin High and Fidelity Advisor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin High and Fidelity Advisor
The main advantage of trading using opposite Franklin High and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin High position performs unexpectedly, Fidelity Advisor 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 Fidelity Advisor will offset losses from the drop in Fidelity Advisor's long position.| Franklin High vs. Vanguard High Yield Corporate | Franklin High vs. Vanguard High Yield Porate | Franklin High vs. Blackrock Hi Yld | Franklin High vs. Blackrock High Yield |
| Fidelity Advisor vs. Great West Goldman Sachs | Fidelity Advisor vs. Europac Gold Fund | Fidelity Advisor vs. James Balanced Golden | Fidelity Advisor vs. Short Precious Metals |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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