Correlation Between Fidelity Canadian and Fidelity Absolute

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

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

Diversification Opportunities for Fidelity Canadian and Fidelity Absolute

0.0

Correlation Coefficient

Fidelity Canadian  Fidelity Absolute

Pay attention - limited upside

The 3 months correlation between Fidelity and Fidelity is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Canadian Growth and Fidelity Absolute Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Absolute Income and Fidelity Canadian 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 Canadian Growth are associated (or correlated) with Fidelity Absolute. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Absolute Income has no effect on the direction of Fidelity Canadian i.e., Fidelity Canadian and Fidelity Absolute go up and down completely randomly.

Pair Corralation between Fidelity Canadian and Fidelity Absolute

If you would invest  9,455  in Fidelity Canadian Growth on April 22, 2025 and sell it today you would earn a total of  1,945  from holding Fidelity Canadian Growth or generate 20.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Fidelity Canadian Growth  vs.  Fidelity Absolute Income

Fidelity Canadian Growth

Risk-Adjusted Performance

Very Strong

Over the last 90 days Fidelity Canadian Growth has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat weak fundamental indicators, Fidelity Canadian sustained solid returns over the last few months and may actually be approaching a breakup point.

Fidelity Absolute Income

Risk-Adjusted Performance

Strong

Over the last 90 days Fidelity Absolute Income has generated negative risk-adjusted returns adding no value to fund investors. In spite of very healthy basic indicators, Fidelity Absolute is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Fidelity Canadian and Fidelity Absolute

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

The idea behind Fidelity Canadian Growth and Fidelity Absolute Income 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.

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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.