Correlation Between Snap and Fidelity Advisor
Can any of the company-specific risk be diversified away by investing in both Snap 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 Snap and Fidelity Advisor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Snap Inc and Fidelity Advisor Strategic, you can compare the effects of market volatilities on Snap 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 Snap with a short position of Fidelity Advisor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snap and Fidelity Advisor.
Diversification Opportunities for Snap and Fidelity Advisor
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Snap and Fidelity is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Snap Inc 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 Snap 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 Snap Inc 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 Snap i.e., Snap and Fidelity Advisor go up and down completely randomly.
Pair Corralation between Snap and Fidelity Advisor
Given the investment horizon of 90 days Snap Inc is expected to generate 22.69 times more return on investment than Fidelity Advisor. However, Snap is 22.69 times more volatile than Fidelity Advisor Strategic. It trades about 0.1 of its potential returns per unit of risk. Fidelity Advisor Strategic is currently generating about 0.21 per unit of risk. If you would invest 1,071 in Snap Inc on August 29, 2024 and sell it today you would earn a total of 89.00 from holding Snap Inc or generate 8.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Snap Inc vs. Fidelity Advisor Strategic
Performance |
| Timeline |
| Snap Inc |
| Fidelity Advisor Str |
Snap and Fidelity Advisor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Snap and Fidelity Advisor
The main advantage of trading using opposite Snap and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snap 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.The idea behind Snap Inc and Fidelity Advisor Strategic pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Fidelity Advisor vs. Fidelity Freedom 2015 | Fidelity Advisor vs. Fidelity Puritan Fund | Fidelity Advisor vs. Fidelity Puritan Fund | Fidelity Advisor vs. Fidelity Pennsylvania Municipal |
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.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| CEOs Directory Screen CEOs from public companies around the world |