Correlation Between Old Westbury and Fidelity Advisor
Can any of the company-specific risk be diversified away by investing in both Old Westbury 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 Old Westbury and Fidelity Advisor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Old Westbury Small and Fidelity Advisor Sustainable, you can compare the effects of market volatilities on Old Westbury 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 Old Westbury with a short position of Fidelity Advisor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Old Westbury and Fidelity Advisor.
Diversification Opportunities for Old Westbury and Fidelity Advisor
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Old and Fidelity is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Old Westbury Small and Fidelity Advisor Sustainable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Sus and Old Westbury 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 Old Westbury Small 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 Sus has no effect on the direction of Old Westbury i.e., Old Westbury and Fidelity Advisor go up and down completely randomly.
Pair Corralation between Old Westbury and Fidelity Advisor
Assuming the 90 days horizon Old Westbury Small is expected to generate 1.27 times more return on investment than Fidelity Advisor. However, Old Westbury is 1.27 times more volatile than Fidelity Advisor Sustainable. It trades about 0.14 of its potential returns per unit of risk. Fidelity Advisor Sustainable is currently generating about 0.15 per unit of risk. If you would invest 1,701 in Old Westbury Small on September 15, 2024 and sell it today you would earn a total of 26.00 from holding Old Westbury Small or generate 1.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Old Westbury Small vs. Fidelity Advisor Sustainable
Performance |
| Timeline |
| Old Westbury Small |
| Fidelity Advisor Sus |
Old Westbury and Fidelity Advisor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Old Westbury and Fidelity Advisor
The main advantage of trading using opposite Old Westbury and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Old Westbury 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.| Old Westbury vs. Old Westbury All | Old Westbury vs. Old Westbury California | Old Westbury vs. Old Westbury Credit | Old Westbury vs. Old Westbury Fixed |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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