Correlation Between Small Cap and Fidelity Advisor
Can any of the company-specific risk be diversified away by investing in both Small Cap 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 Small Cap and Fidelity Advisor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Small Cap Core and Fidelity Advisor Health, you can compare the effects of market volatilities on Small Cap 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 Small Cap with a short position of Fidelity Advisor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Small Cap and Fidelity Advisor.
Diversification Opportunities for Small Cap and Fidelity Advisor
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Small and Fidelity is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Small Cap Core and Fidelity Advisor Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Health and Small Cap 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 Small Cap Core 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 Health has no effect on the direction of Small Cap i.e., Small Cap and Fidelity Advisor go up and down completely randomly.
Pair Corralation between Small Cap and Fidelity Advisor
Assuming the 90 days horizon Small Cap Core is expected to generate 1.3 times more return on investment than Fidelity Advisor. However, Small Cap is 1.3 times more volatile than Fidelity Advisor Health. It trades about 0.18 of its potential returns per unit of risk. Fidelity Advisor Health is currently generating about 0.23 per unit of risk. If you would invest 1,189 in Small Cap Core on June 6, 2025 and sell it today you would earn a total of 56.00 from holding Small Cap Core or generate 4.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Small Cap Core vs. Fidelity Advisor Health
Performance |
| Timeline |
| Small Cap Core |
| Fidelity Advisor Health |
Small Cap and Fidelity Advisor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Small Cap and Fidelity Advisor
The main advantage of trading using opposite Small Cap and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Small Cap 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.| Small Cap vs. Artisan Small Cap | Small Cap vs. Morningstar Growth Etf | Small Cap vs. Aston Montag Caldwell | Small Cap vs. Growth Fund C |
| Fidelity Advisor vs. Fidelity Advisor Technology | Fidelity Advisor vs. Fidelity Advisor Biotechnology | Fidelity Advisor vs. Fidelity Advisor Financial | Fidelity Advisor vs. Fidelity Advisor Utilities |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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