Correlation Between Fidelity Advisor and Prudential California
Can any of the company-specific risk be diversified away by investing in both Fidelity Advisor and Prudential California 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 Prudential California into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Advisor Diversified and Prudential California Muni, you can compare the effects of market volatilities on Fidelity Advisor and Prudential California 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 Prudential California. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Advisor and Prudential California.
Diversification Opportunities for Fidelity Advisor and Prudential California
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fidelity and Prudential is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Advisor Diversified and Prudential California Muni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prudential California 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 Diversified are associated (or correlated) with Prudential California. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prudential California has no effect on the direction of Fidelity Advisor i.e., Fidelity Advisor and Prudential California go up and down completely randomly.
Pair Corralation between Fidelity Advisor and Prudential California
Assuming the 90 days horizon Fidelity Advisor Diversified is expected to generate 5.56 times more return on investment than Prudential California. However, Fidelity Advisor is 5.56 times more volatile than Prudential California Muni. It trades about 0.27 of its potential returns per unit of risk. Prudential California Muni is currently generating about 0.16 per unit of risk. If you would invest 2,643 in Fidelity Advisor Diversified on April 21, 2025 and sell it today you would earn a total of 332.00 from holding Fidelity Advisor Diversified or generate 12.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Advisor Diversified vs. Prudential California Muni
Performance |
| Timeline |
| Fidelity Advisor Div |
| Prudential California |
Fidelity Advisor and Prudential California Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Advisor and Prudential California
The main advantage of trading using opposite Fidelity Advisor and Prudential California positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Advisor position performs unexpectedly, Prudential California 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 Prudential California will offset losses from the drop in Prudential California's long position.| Fidelity Advisor vs. Fidelity Small Cap | Fidelity Advisor vs. Fidelity International Growth | Fidelity Advisor vs. Fidelity Advisor Mid | Fidelity Advisor vs. Foreign Smaller Panies |
| Prudential California vs. Valic Company I | Prudential California vs. Fpa Queens Road | Prudential California vs. Lord Abbett Small | Prudential California vs. Hennessy Nerstone Mid |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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