Correlation Between Disney and Fidelity Low

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

Diversification Opportunities for Disney and Fidelity Low

-0.46
  Correlation Coefficient

Very good diversification

The 3 months correlation between Disney and Fidelity is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Walt Disney and Fidelity Low Volatility in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Low Volatility and Disney 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 Walt Disney are associated (or correlated) with Fidelity Low. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Low Volatility has no effect on the direction of Disney i.e., Disney and Fidelity Low go up and down completely randomly.

Pair Corralation between Disney and Fidelity Low

Considering the 90-day investment horizon Walt Disney is expected to under-perform the Fidelity Low. In addition to that, Disney is 2.62 times more volatile than Fidelity Low Volatility. It trades about -0.13 of its total potential returns per unit of risk. Fidelity Low Volatility is currently generating about 0.14 per unit of volatility. If you would invest  6,431  in Fidelity Low Volatility on August 30, 2025 and sell it today you would earn a total of  316.00  from holding Fidelity Low Volatility or generate 4.91% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Walt Disney  vs.  Fidelity Low Volatility

 Performance 
       Timeline  
Walt Disney 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days Walt Disney has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's forward indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.
Fidelity Low Volatility 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Low Volatility are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy essential indicators, Fidelity Low is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Disney and Fidelity Low Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Disney and Fidelity Low

The main advantage of trading using opposite Disney and Fidelity Low positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Disney position performs unexpectedly, Fidelity Low 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 Low will offset losses from the drop in Fidelity Low's long position.
The idea behind Walt Disney and Fidelity Low Volatility 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.

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