Correlation Between Fidelity National and AdvancedAdvT

Can any of the company-specific risk be diversified away by investing in both Fidelity National and AdvancedAdvT 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 National and AdvancedAdvT into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fidelity National Information and AdvancedAdvT, you can compare the effects of market volatilities on Fidelity National and AdvancedAdvT 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 National with a short position of AdvancedAdvT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity National and AdvancedAdvT.

Diversification Opportunities for Fidelity National and AdvancedAdvT

0.54

Correlation Coefficient

Fidelity National  AdvancedAdvT

Very weak diversification

The 3 months correlation between Fidelity and AdvancedAdvT is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity National Information and AdvancedAdvT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AdvancedAdvT and Fidelity National 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 National Information are associated (or correlated) with AdvancedAdvT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AdvancedAdvT has no effect on the direction of Fidelity National i.e., Fidelity National and AdvancedAdvT go up and down completely randomly.

Pair Corralation between Fidelity National and AdvancedAdvT

Assuming the 90 days trading horizon Fidelity National is expected to generate 9.33 times less return on investment than AdvancedAdvT. But when comparing it to its historical volatility, Fidelity National Information is 1.4 times less risky than AdvancedAdvT. It trades about 0.03 of its potential returns per unit of risk. AdvancedAdvT is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  15,000  in AdvancedAdvT on April 23, 2025 and sell it today you would earn a total of  3,250  from holding AdvancedAdvT or generate 21.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

Fidelity National Information  vs.  AdvancedAdvT

Fidelity National

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity National Information are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Fidelity National is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

AdvancedAdvT

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in AdvancedAdvT are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, AdvancedAdvT unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fidelity National and AdvancedAdvT

The main advantage of trading using opposite Fidelity National and AdvancedAdvT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity National position performs unexpectedly, AdvancedAdvT 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 AdvancedAdvT will offset losses from the drop in AdvancedAdvT's long position.

The idea behind Fidelity National Information and AdvancedAdvT 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.