Correlation Between Fidelity Pennsylvania and Fidelity Advisor

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Fidelity Pennsylvania 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 Pennsylvania 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 Pennsylvania Municipal and Fidelity Advisor Dividend, you can compare the effects of market volatilities on Fidelity Pennsylvania 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 Pennsylvania with a short position of Fidelity Advisor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Pennsylvania and Fidelity Advisor.

Diversification Opportunities for Fidelity Pennsylvania and Fidelity Advisor

0.11
  Correlation Coefficient

Average diversification

The 3 months correlation between Fidelity and Fidelity is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Pennsylvania Municipa and Fidelity Advisor Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Dividend and Fidelity Pennsylvania 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 Pennsylvania Municipal 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 Dividend has no effect on the direction of Fidelity Pennsylvania i.e., Fidelity Pennsylvania and Fidelity Advisor go up and down completely randomly.

Pair Corralation between Fidelity Pennsylvania and Fidelity Advisor

Assuming the 90 days horizon Fidelity Pennsylvania Municipal is expected to under-perform the Fidelity Advisor. But the mutual fund apears to be less risky and, when comparing its historical volatility, Fidelity Pennsylvania Municipal is 3.24 times less risky than Fidelity Advisor. The mutual fund trades about -0.03 of its potential returns per unit of risk. The Fidelity Advisor Dividend is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  2,088  in Fidelity Advisor Dividend on September 17, 2024 and sell it today you would earn a total of  140.00  from holding Fidelity Advisor Dividend or generate 6.7% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Fidelity Pennsylvania Municipa  vs.  Fidelity Advisor Dividend

 Performance 
       Timeline  
Fidelity Pennsylvania 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Fidelity Pennsylvania Municipal has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Fidelity Pennsylvania is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Fidelity Advisor Dividend 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Advisor Dividend are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Fidelity Advisor may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Fidelity Pennsylvania and Fidelity Advisor Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Fidelity Pennsylvania and Fidelity Advisor

The main advantage of trading using opposite Fidelity Pennsylvania and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Pennsylvania 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 Pennsylvania Municipal and Fidelity Advisor Dividend 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 Stocks Directory module to find actively traded stocks across global markets.

Other Complementary Tools

Alpha Finder
Use alpha and beta coefficients to find investment opportunities after accounting for the risk
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
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
Fundamental Analysis
View fundamental data based on most recent published financial statements