Correlation Between Fidelity Advisor and Consumer Products
Can any of the company-specific risk be diversified away by investing in both Fidelity Advisor and Consumer Products 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 Consumer Products into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Advisor Technology and Consumer Products Fund, you can compare the effects of market volatilities on Fidelity Advisor and Consumer Products 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 Consumer Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Advisor and Consumer Products.
Diversification Opportunities for Fidelity Advisor and Consumer Products
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fidelity and Consumer is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Advisor Technology and Consumer Products Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Consumer Products 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 Technology are associated (or correlated) with Consumer Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Consumer Products has no effect on the direction of Fidelity Advisor i.e., Fidelity Advisor and Consumer Products go up and down completely randomly.
Pair Corralation between Fidelity Advisor and Consumer Products
Assuming the 90 days horizon Fidelity Advisor Technology is expected to generate 2.33 times more return on investment than Consumer Products. However, Fidelity Advisor is 2.33 times more volatile than Consumer Products Fund. It trades about 0.1 of its potential returns per unit of risk. Consumer Products Fund is currently generating about 0.1 per unit of risk. If you would invest 14,107 in Fidelity Advisor Technology on August 28, 2024 and sell it today you would earn a total of 380.00 from holding Fidelity Advisor Technology or generate 2.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Fidelity Advisor Technology vs. Consumer Products Fund
Performance |
| Timeline |
| Fidelity Advisor Tec |
| Consumer Products |
Fidelity Advisor and Consumer Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Advisor and Consumer Products
The main advantage of trading using opposite Fidelity Advisor and Consumer Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Advisor position performs unexpectedly, Consumer Products 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 Consumer Products will offset losses from the drop in Consumer Products' long position.| Fidelity Advisor vs. Fidelity Advisor Financial | Fidelity Advisor vs. Fidelity Advisor Energy | Fidelity Advisor vs. Fidelity Advisor Semiconductors | Fidelity Advisor vs. Aquagold International |
| Consumer Products vs. Kellanova | Consumer Products vs. Bunge Limited | Consumer Products vs. BJs Wholesale Club | Consumer Products vs. Colgate Palmolive |
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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