Correlation Between Small Cap and Fidelity Otc

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

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

Diversification Opportunities for Small Cap and Fidelity Otc

0.63

Correlation Coefficient

Small Cap  Fidelity Otc

Poor diversification

The 3 months correlation between Small and Fidelity is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Small Cap Value Series and Fidelity Otc Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Otc Portfolio and Small Cap 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 Small Cap Value Series are associated (or correlated) with Fidelity Otc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Otc Portfolio has no effect on the direction of Small Cap i.e., Small Cap and Fidelity Otc go up and down completely randomly.

Pair Corralation between Small Cap and Fidelity Otc

Assuming the 90 days horizon Small Cap is expected to generate 5.85 times less return on investment than Fidelity Otc. In addition to that, Small Cap is 1.47 times more volatile than Fidelity Otc Portfolio. It trades about 0.03 of its total potential returns per unit of risk. Fidelity Otc Portfolio is currently generating about 0.25 per unit of volatility. If you would invest  2,179  in Fidelity Otc Portfolio on July 2, 2025 and sell it today you would earn a total of  272.00  from holding Fidelity Otc Portfolio or generate 12.48% return on investment over 90 days.

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

Small Cap Value Series  vs.  Fidelity Otc Portfolio

Small Cap Value

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Small Cap Value Series are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Small Cap is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Fidelity Otc Portfolio

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Otc Portfolio are ranked lower than 19 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward-looking signals, Fidelity Otc may actually be approaching a critical reversion point that can send shares even higher in October 2025.

Pair Trading with Small Cap and Fidelity Otc

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

The idea behind Small Cap Value Series and Fidelity Otc Portfolio 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.