Correlation Between Franklin Growth and Fidelity Advisor
Can any of the company-specific risk be diversified away by investing in both Franklin Growth 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 Growth 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 Growth Fund and Fidelity Advisor Financial, you can compare the effects of market volatilities on Franklin Growth 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 Growth with a short position of Fidelity Advisor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Growth and Fidelity Advisor.
Diversification Opportunities for Franklin Growth and Fidelity Advisor
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between FRANKLIN and Fidelity is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Growth Fund and Fidelity Advisor Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Fin and Franklin Growth 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 Growth Fund 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 Fin has no effect on the direction of Franklin Growth i.e., Franklin Growth and Fidelity Advisor go up and down completely randomly.
Pair Corralation between Franklin Growth and Fidelity Advisor
Assuming the 90 days horizon Franklin Growth is expected to generate 3.11 times less return on investment than Fidelity Advisor. But when comparing it to its historical volatility, Franklin Growth Fund is 1.26 times less risky than Fidelity Advisor. It trades about 0.07 of its potential returns per unit of risk. Fidelity Advisor Financial is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 3,109 in Fidelity Advisor Financial on September 3, 2024 and sell it today you would earn a total of 932.00 from holding Fidelity Advisor Financial or generate 29.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Franklin Growth Fund vs. Fidelity Advisor Financial
Performance |
| Timeline |
| Franklin Growth |
| Fidelity Advisor Fin |
Franklin Growth and Fidelity Advisor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Growth and Fidelity Advisor
The main advantage of trading using opposite Franklin Growth and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Growth 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 Growth vs. Fidelity Advisor Financial | Franklin Growth vs. Prudential Financial Services | Franklin Growth vs. Financials Ultrasector Profund | Franklin Growth vs. Gabelli Global Financial |
| Fidelity Advisor vs. Tax Managed Mid Small | Fidelity Advisor vs. Small Pany Growth | Fidelity Advisor vs. Rbc Small Cap | Fidelity Advisor vs. Ancorathelen Small Mid Cap |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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