Correlation Between Fidelity Advisor and Brandes International

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

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

Diversification Opportunities for Fidelity Advisor and Brandes International

-0.75

Correlation Coefficient

Fidelity Advisor  Brandes International

Pay attention - limited upside

The 3 months correlation between Fidelity and BRANDES is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Advisor Technology and Brandes International Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brandes International 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 Technology are associated (or correlated) with Brandes International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brandes International has no effect on the direction of Fidelity Advisor i.e., Fidelity Advisor and Brandes International go up and down completely randomly.

Pair Corralation between Fidelity Advisor and Brandes International

Assuming the 90 days horizon Fidelity Advisor Technology is expected to under-perform the Brandes International. In addition to that, Fidelity Advisor is 2.35 times more volatile than Brandes International Equity. It trades about -0.1 of its total potential returns per unit of risk. Brandes International Equity is currently generating about 0.25 per unit of volatility. If you would invest  2,131  in Brandes International Equity on December 27, 2024 and sell it today you would earn a total of  278.00  from holding Brandes International Equity or generate 13.05% return on investment over 90 days.

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

Fidelity Advisor Technology  vs.  Brandes International Equity

Fidelity Advisor Tec

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fidelity Advisor Technology has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's technical indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Brandes International

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Brandes International Equity are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Brandes International showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fidelity Advisor and Brandes International

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

The idea behind Fidelity Advisor Technology and Brandes International Equity 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.