Correlation Between Fidelity Puritan and Fidelity Advisor

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Fidelity Puritan 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 Fidelity Puritan and Fidelity Advisor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Puritan Fund and Fidelity Advisor Large, you can compare the effects of market volatilities on Fidelity Puritan 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 Fidelity Puritan with a short position of Fidelity Advisor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Puritan and Fidelity Advisor.

Diversification Opportunities for Fidelity Puritan and Fidelity Advisor

0.97
  Correlation Coefficient

Almost no diversification

The 3 months correlation between Fidelity and Fidelity is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Puritan Fund and Fidelity Advisor Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Large and Fidelity Puritan 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 Puritan Fund 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 Large has no effect on the direction of Fidelity Puritan i.e., Fidelity Puritan and Fidelity Advisor go up and down completely randomly.

Pair Corralation between Fidelity Puritan and Fidelity Advisor

Assuming the 90 days horizon Fidelity Puritan is expected to generate 1.34 times less return on investment than Fidelity Advisor. But when comparing it to its historical volatility, Fidelity Puritan Fund is 1.3 times less risky than Fidelity Advisor. It trades about 0.28 of its potential returns per unit of risk. Fidelity Advisor Large is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest  5,018  in Fidelity Advisor Large on September 9, 2024 and sell it today you would earn a total of  627.00  from holding Fidelity Advisor Large or generate 12.5% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy100.0%
ValuesDaily Returns

Fidelity Puritan Fund  vs.  Fidelity Advisor Large

 Performance 
       Timeline  
Fidelity Puritan 

Risk-Adjusted Performance

21 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Puritan Fund are ranked lower than 21 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Fidelity Puritan may actually be approaching a critical reversion point that can send shares even higher in January 2025.
Fidelity Advisor Large 

Risk-Adjusted Performance

22 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Advisor Large are ranked lower than 22 (%) 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 Puritan and Fidelity Advisor Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Fidelity Puritan and Fidelity Advisor

The main advantage of trading using opposite Fidelity Puritan and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Puritan 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 Fidelity Puritan Fund and Fidelity Advisor Large 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.

Other Complementary Tools

Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Technical Analysis
Check basic technical indicators and analysis based on most latest market data
Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios
Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals