Correlation Between Fidelity Advisor and Leader Short

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Fidelity Advisor and Leader Short 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 Leader Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Advisor Floating and Leader Short Term Bond, you can compare the effects of market volatilities on Fidelity Advisor and Leader Short 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 Leader Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Advisor and Leader Short.

Diversification Opportunities for Fidelity Advisor and Leader Short

0.92
  Correlation Coefficient

Almost no diversification

The 3 months correlation between Fidelity and Leader is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Advisor Floating and Leader Short Term Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leader Short Term 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 Floating are associated (or correlated) with Leader Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leader Short Term has no effect on the direction of Fidelity Advisor i.e., Fidelity Advisor and Leader Short go up and down completely randomly.

Pair Corralation between Fidelity Advisor and Leader Short

Assuming the 90 days horizon Fidelity Advisor is expected to generate 1.17 times less return on investment than Leader Short. But when comparing it to its historical volatility, Fidelity Advisor Floating is 1.39 times less risky than Leader Short. It trades about 0.27 of its potential returns per unit of risk. Leader Short Term Bond is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  802.00  in Leader Short Term Bond on October 22, 2024 and sell it today you would earn a total of  26.00  from holding Leader Short Term Bond or generate 3.24% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy100.0%
ValuesDaily Returns

Fidelity Advisor Floating  vs.  Leader Short Term Bond

 Performance 
       Timeline  
Fidelity Advisor Floating 

Risk-Adjusted Performance

21 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Advisor Floating are ranked lower than 21 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical indicators, Fidelity Advisor is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Leader Short Term 

Risk-Adjusted Performance

17 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Leader Short Term Bond are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong primary indicators, Leader Short is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Fidelity Advisor and Leader Short Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Fidelity Advisor and Leader Short

The main advantage of trading using opposite Fidelity Advisor and Leader Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Advisor position performs unexpectedly, Leader Short 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 Leader Short will offset losses from the drop in Leader Short's long position.
The idea behind Fidelity Advisor Floating and Leader Short Term Bond 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.

Other Complementary Tools

Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes
Efficient Frontier
Plot and analyze your portfolio and positions against risk-return landscape of the market.
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like
Investing Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
Commodity Directory
Find actively traded commodities issued by global exchanges