Correlation Between Intel and Fidelity Advisor

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

By analyzing existing cross correlation between Intel and Fidelity Advisor 529, you can compare the effects of market volatilities on Intel 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 Intel with a short position of Fidelity Advisor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and Fidelity Advisor.

Diversification Opportunities for Intel and Fidelity Advisor

0.83

Correlation Coefficient

Intel  Fidelity Advisor

Very poor diversification

The 3 months correlation between Intel and Fidelity is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Intel and Fidelity Advisor 529 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor 529 and Intel 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 Intel 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 529 has no effect on the direction of Intel i.e., Intel and Fidelity Advisor go up and down completely randomly.

Pair Corralation between Intel and Fidelity Advisor

Given the investment horizon of 90 days Intel is expected to generate 2.39 times more return on investment than Fidelity Advisor. However, Intel is 2.39 times more volatile than Fidelity Advisor 529. It trades about 0.12 of its potential returns per unit of risk. Fidelity Advisor 529 is currently generating about 0.14 per unit of risk. If you would invest  2,010  in Intel on September 3, 2024 and sell it today you would earn a total of  395.00  from holding Intel or generate 19.65% return on investment over 90 days.

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

Intel  vs.  Fidelity Advisor 529

Intel

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Intel are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Intel exhibited solid returns over the last few months and may actually be approaching a breakup point.

Fidelity Advisor 529

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Advisor 529 are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Fidelity Advisor may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Intel and Fidelity Advisor

The main advantage of trading using opposite Intel and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel 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 Intel and Fidelity Advisor 529 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.