Correlation Between Neo Concept and Fidelity Advisor

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

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

Diversification Opportunities for Neo Concept and Fidelity Advisor

-0.52

Correlation Coefficient

Neo Concept  Fidelity Advisor

Excellent diversification

The 3 months correlation between Neo and Fidelity is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Neo Concept International Grou and Fidelity Advisor Sumer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Sumer and Neo Concept 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 Neo Concept International Group 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 Sumer has no effect on the direction of Neo Concept i.e., Neo Concept and Fidelity Advisor go up and down completely randomly.

Pair Corralation between Neo Concept and Fidelity Advisor

Considering the 90-day investment horizon Neo Concept International Group is expected to generate 3.52 times more return on investment than Fidelity Advisor. However, Neo Concept is 3.52 times more volatile than Fidelity Advisor Sumer. It trades about 0.17 of its potential returns per unit of risk. Fidelity Advisor Sumer is currently generating about -0.21 per unit of risk. If you would invest  58.00  in Neo Concept International Group on October 8, 2024 and sell it today you would earn a total of  13.00  from holding Neo Concept International Group or generate 22.41% return on investment over 90 days.

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

Neo Concept International Grou  vs.  Fidelity Advisor Sumer

Neo Concept Internat

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Neo Concept International Group are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly unsteady fundamental indicators, Neo Concept demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Fidelity Advisor Sumer

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Advisor Sumer are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Fidelity Advisor is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Neo Concept and Fidelity Advisor

The main advantage of trading using opposite Neo Concept and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neo Concept 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 Neo Concept International Group and Fidelity Advisor Sumer 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.