Correlation Between Crown Holdings and Fidelity Advisor

Can any of the company-specific risk be diversified away by investing in both Crown Holdings 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 Crown Holdings and Fidelity Advisor into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Crown Holdings and Fidelity Advisor Sumer, you can compare the effects of market volatilities on Crown Holdings 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 Crown Holdings with a short position of Fidelity Advisor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crown Holdings and Fidelity Advisor.

Diversification Opportunities for Crown Holdings and Fidelity Advisor

-0.4

Correlation Coefficient

Crown Holdings  Fidelity Advisor

Very good diversification

The 3 months correlation between Crown and Fidelity is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Crown Holdings and Fidelity Advisor Sumer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Sumer and Crown Holdings 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 Crown Holdings 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 Sumer has no effect on the direction of Crown Holdings i.e., Crown Holdings and Fidelity Advisor go up and down completely randomly.

Pair Corralation between Crown Holdings and Fidelity Advisor

Considering the 90-day investment horizon Crown Holdings is expected to generate 32.59 times less return on investment than Fidelity Advisor. In addition to that, Crown Holdings is 1.3 times more volatile than Fidelity Advisor Sumer. It trades about 0.0 of its total potential returns per unit of risk. Fidelity Advisor Sumer is currently generating about 0.07 per unit of volatility. If you would invest  2,333  in Fidelity Advisor Sumer on October 8, 2024 and sell it today you would earn a total of  1,142  from holding Fidelity Advisor Sumer or generate 48.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	99.8%
Values	Daily Returns

Crown Holdings  vs.  Fidelity Advisor Sumer

Crown Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Crown Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's fundamental indicators remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Fidelity Advisor Sumer

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Advisor Sumer are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Fidelity Advisor is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Crown Holdings and Fidelity Advisor

The main advantage of trading using opposite Crown Holdings and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crown Holdings 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 Crown Holdings and Fidelity Advisor Sumer 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.

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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.