Correlation Between Fidelity International and Fidelity Greater

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

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

Diversification Opportunities for Fidelity International and Fidelity Greater

0.95

Correlation Coefficient

Fidelity International  Fidelity Greater

Almost no diversification

The 3 months correlation between Fidelity and Fidelity is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity International Value and Fidelity Greater Canada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Greater Canada and Fidelity International 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 International Value are associated (or correlated) with Fidelity Greater. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Greater Canada has no effect on the direction of Fidelity International i.e., Fidelity International and Fidelity Greater go up and down completely randomly.

Pair Corralation between Fidelity International and Fidelity Greater

Assuming the 90 days trading horizon Fidelity International is expected to generate 1.72 times less return on investment than Fidelity Greater. But when comparing it to its historical volatility, Fidelity International Value is 1.45 times less risky than Fidelity Greater. It trades about 0.23 of its potential returns per unit of risk. Fidelity Greater Canada is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest  1,082  in Fidelity Greater Canada on April 20, 2025 and sell it today you would earn a total of  211.00  from holding Fidelity Greater Canada or generate 19.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Fidelity International Value  vs.  Fidelity Greater Canada

Fidelity International

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity International Value are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Fidelity International may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Fidelity Greater Canada

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Greater Canada are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating technical and fundamental indicators, Fidelity Greater exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fidelity International and Fidelity Greater

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

The idea behind Fidelity International Value and Fidelity Greater Canada 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.