Correlation Between Fidelity Advisor and Pioneer Disciplined

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

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

Diversification Opportunities for Fidelity Advisor and Pioneer Disciplined

0.62

Correlation Coefficient

Fidelity Advisor  Pioneer Disciplined

Poor diversification

The 3 months correlation between Fidelity and Pioneer is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Advisor Financial and Pioneer Disciplined Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pioneer Disciplined 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 Financial are associated (or correlated) with Pioneer Disciplined. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pioneer Disciplined has no effect on the direction of Fidelity Advisor i.e., Fidelity Advisor and Pioneer Disciplined go up and down completely randomly.

Pair Corralation between Fidelity Advisor and Pioneer Disciplined

Assuming the 90 days horizon Fidelity Advisor Financial is expected to generate 0.48 times more return on investment than Pioneer Disciplined. However, Fidelity Advisor Financial is 2.1 times less risky than Pioneer Disciplined. It trades about -0.01 of its potential returns per unit of risk. Pioneer Disciplined Growth is currently generating about -0.09 per unit of risk. If you would invest  3,914  in Fidelity Advisor Financial on September 17, 2024 and sell it today you would lose (7.00) from holding Fidelity Advisor Financial or give up 0.18% of portfolio value over 90 days.

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

Fidelity Advisor Financial  vs.  Pioneer Disciplined Growth

Fidelity Advisor Fin

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Advisor Financial are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental drivers, Fidelity Advisor showed solid returns over the last few months and may actually be approaching a breakup point.

Pioneer Disciplined

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Pioneer Disciplined Growth are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Pioneer Disciplined 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 Pioneer Disciplined

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

The idea behind Fidelity Advisor Financial and Pioneer Disciplined 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.

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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.