Correlation Between Fidelity High and RBC Quant

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

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

Diversification Opportunities for Fidelity High and RBC Quant

0.84

Correlation Coefficient

Fidelity High  RBC Quant

Very poor diversification

The 3 months correlation between Fidelity and RBC is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity High Dividend and RBC Quant Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RBC Quant Dividend and Fidelity High 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 High Dividend are associated (or correlated) with RBC Quant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RBC Quant Dividend has no effect on the direction of Fidelity High i.e., Fidelity High and RBC Quant go up and down completely randomly.

Pair Corralation between Fidelity High and RBC Quant

Assuming the 90 days trading horizon Fidelity High is expected to generate 1.31 times less return on investment than RBC Quant. But when comparing it to its historical volatility, Fidelity High Dividend is 1.15 times less risky than RBC Quant. It trades about 0.21 of its potential returns per unit of risk. RBC Quant Dividend is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest  2,210  in RBC Quant Dividend on April 23, 2025 and sell it today you would earn a total of  307.00  from holding RBC Quant Dividend or generate 13.89% return on investment over 90 days.

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

Fidelity High Dividend  vs.  RBC Quant Dividend

Fidelity High Dividend

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity High Dividend are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Fidelity High may actually be approaching a critical reversion point that can send shares even higher in August 2025.

RBC Quant Dividend

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in RBC Quant Dividend are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental indicators, RBC Quant displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fidelity High and RBC Quant

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

The idea behind Fidelity High Dividend and RBC Quant Dividend 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.