Correlation Between Fidelity Advisor and Fidelity Sai

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

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

Diversification Opportunities for Fidelity Advisor and Fidelity Sai

0.54

Correlation Coefficient

Fidelity Advisor  Fidelity Sai

Very weak diversification

The 3 months correlation between Fidelity and Fidelity is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Advisor 529 and Fidelity Sai Alternative in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Sai Alternative 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 529 are associated (or correlated) with Fidelity Sai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Sai Alternative has no effect on the direction of Fidelity Advisor i.e., Fidelity Advisor and Fidelity Sai go up and down completely randomly.

Pair Corralation between Fidelity Advisor and Fidelity Sai

Assuming the 90 days horizon Fidelity Advisor 529 is expected to generate 2.11 times more return on investment than Fidelity Sai. However, Fidelity Advisor is 2.11 times more volatile than Fidelity Sai Alternative. It trades about 0.14 of its potential returns per unit of risk. Fidelity Sai Alternative is currently generating about 0.14 per unit of risk. If you would invest  6,744  in Fidelity Advisor 529 on September 3, 2024 and sell it today you would earn a total of  661.00  from holding Fidelity Advisor 529 or generate 9.8% return on investment over 90 days.

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

Fidelity Advisor 529  vs.  Fidelity Sai Alternative

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.

Fidelity Sai Alternative

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Sai Alternative are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Fidelity Sai 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 Fidelity Sai

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

The idea behind Fidelity Advisor 529 and Fidelity Sai Alternative 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.