Correlation Between XIAO I and Fidelity Advisor

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

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

Diversification Opportunities for XIAO I and Fidelity Advisor

-0.87

Correlation Coefficient

XIAO I  Fidelity Advisor

Pay attention - limited upside

The 3 months correlation between XIAO and Fidelity is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding XIAO I American and Fidelity Advisor Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Tec and XIAO I 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 XIAO I American 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 Tec has no effect on the direction of XIAO I i.e., XIAO I and Fidelity Advisor go up and down completely randomly.

Pair Corralation between XIAO I and Fidelity Advisor

Given the investment horizon of 90 days XIAO I American is expected to under-perform the Fidelity Advisor. In addition to that, XIAO I is 5.35 times more volatile than Fidelity Advisor Technology. It trades about -0.15 of its total potential returns per unit of risk. Fidelity Advisor Technology is currently generating about 0.34 per unit of volatility. If you would invest  9,553  in Fidelity Advisor Technology on May 4, 2025 and sell it today you would earn a total of  2,506  from holding Fidelity Advisor Technology or generate 26.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

XIAO I American  vs.  Fidelity Advisor Technology

XIAO I American

Risk-Adjusted Performance

Very Weak

Over the last 90 days XIAO I American has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in September 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Fidelity Advisor Tec

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Advisor Technology are ranked lower than 26 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Fidelity Advisor showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with XIAO I and Fidelity Advisor

The main advantage of trading using opposite XIAO I and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XIAO I 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.

The idea behind XIAO I American and Fidelity Advisor Technology 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..