Correlation Between Fidelity Advisor and Large Capital

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

By analyzing existing cross correlation between Fidelity Advisor Gold and Large Capital Growth, you can compare the effects of market volatilities on Fidelity Advisor and Large Capital 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 Large Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Advisor and Large Capital.

Diversification Opportunities for Fidelity Advisor and Large Capital

-0.01

Correlation Coefficient

Fidelity Advisor  Large Capital

Good diversification

The 3 months correlation between Fidelity and Large is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Advisor Gold and Large Capital Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Large Capital Growth 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 Gold are associated (or correlated) with Large Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Large Capital Growth has no effect on the direction of Fidelity Advisor i.e., Fidelity Advisor and Large Capital go up and down completely randomly.

Pair Corralation between Fidelity Advisor and Large Capital

Assuming the 90 days horizon Fidelity Advisor Gold is expected to under-perform the Large Capital. In addition to that, Fidelity Advisor is 2.62 times more volatile than Large Capital Growth. It trades about -0.01 of its total potential returns per unit of risk. Large Capital Growth is currently generating about 0.13 per unit of volatility. If you would invest  2,074  in Large Capital Growth on September 12, 2024 and sell it today you would earn a total of  105.00  from holding Large Capital Growth or generate 5.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Fidelity Advisor Gold  vs.  Large Capital Growth

Fidelity Advisor Gold

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Fidelity Advisor Gold has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Fidelity Advisor is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Large Capital Growth

Risk-Adjusted Performance

9 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Large Capital Growth are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Large Capital is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Fidelity Advisor and Large Capital

The main advantage of trading using opposite Fidelity Advisor and Large Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Advisor position performs unexpectedly, Large Capital 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 Large Capital will offset losses from the drop in Large Capital's long position.

The idea behind Fidelity Advisor Gold and Large Capital Growth 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.