Correlation Between Fidelity Advisor and Salient Select
Can any of the company-specific risk be diversified away by investing in both Fidelity Advisor and Salient Select 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 Salient Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Advisor Diversified and Salient Select Income, you can compare the effects of market volatilities on Fidelity Advisor and Salient Select 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 Salient Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Advisor and Salient Select.
Diversification Opportunities for Fidelity Advisor and Salient Select
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Fidelity and Salient is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Advisor Diversified and Salient Select Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salient Select Income 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 Diversified are associated (or correlated) with Salient Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salient Select Income has no effect on the direction of Fidelity Advisor i.e., Fidelity Advisor and Salient Select go up and down completely randomly.
Pair Corralation between Fidelity Advisor and Salient Select
Assuming the 90 days horizon Fidelity Advisor Diversified is expected to generate 1.52 times more return on investment than Salient Select. However, Fidelity Advisor is 1.52 times more volatile than Salient Select Income. It trades about 0.06 of its potential returns per unit of risk. Salient Select Income is currently generating about 0.08 per unit of risk. If you would invest 2,237 in Fidelity Advisor Diversified on September 4, 2024 and sell it today you would earn a total of 566.00 from holding Fidelity Advisor Diversified or generate 25.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Advisor Diversified vs. Salient Select Income
Performance |
| Timeline |
| Fidelity Advisor Div |
| Salient Select Income |
Fidelity Advisor and Salient Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Advisor and Salient Select
The main advantage of trading using opposite Fidelity Advisor and Salient Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Advisor position performs unexpectedly, Salient Select 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 Salient Select will offset losses from the drop in Salient Select's long position.| Fidelity Advisor vs. Fidelity International Growth | Fidelity Advisor vs. Foreign Smaller Panies | Fidelity Advisor vs. Hartford Small Cap | Fidelity Advisor vs. Fidelity Small Cap |
| Salient Select vs. Salient Tactical Plus | Salient Select vs. Salient Tactical Plus | Salient Select vs. Salient Tactical Plus | Salient Select vs. Salient Tactical Plus |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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