Correlation Between FirstEnergy and Fidelity Advisor

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

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

Diversification Opportunities for FirstEnergy and Fidelity Advisor

0.01

Correlation Coefficient

FirstEnergy  Fidelity Advisor

Significant diversification

The 3 months correlation between FirstEnergy and Fidelity is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding FirstEnergy and Fidelity Advisor Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Uti and FirstEnergy 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 FirstEnergy 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 Uti has no effect on the direction of FirstEnergy i.e., FirstEnergy and Fidelity Advisor go up and down completely randomly.

Pair Corralation between FirstEnergy and Fidelity Advisor

Allowing for the 90-day total investment horizon FirstEnergy is expected to generate 5.16 times less return on investment than Fidelity Advisor. In addition to that, FirstEnergy is 1.2 times more volatile than Fidelity Advisor Utilities. It trades about 0.03 of its total potential returns per unit of risk. Fidelity Advisor Utilities is currently generating about 0.16 per unit of volatility. If you would invest  4,482  in Fidelity Advisor Utilities on May 5, 2025 and sell it today you would earn a total of  363.00  from holding Fidelity Advisor Utilities or generate 8.1% return on investment over 90 days.

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

FirstEnergy  vs.  Fidelity Advisor Utilities

FirstEnergy

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in FirstEnergy are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, FirstEnergy is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Fidelity Advisor Uti

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Advisor Utilities are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly unsteady technical and fundamental indicators, Fidelity Advisor may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with FirstEnergy and Fidelity Advisor

The main advantage of trading using opposite FirstEnergy and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FirstEnergy 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 FirstEnergy and Fidelity Advisor Utilities 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.