Correlation Between Technology Select and Fidelity Sustainable

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

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

Diversification Opportunities for Technology Select and Fidelity Sustainable

0.79

Correlation Coefficient

Technology Select  Fidelity Sustainable

Poor diversification

The 3 months correlation between Technology and Fidelity is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Technology Select Sector and Fidelity Sustainable EUR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Sustainable EUR and Technology Select 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 Technology Select Sector are associated (or correlated) with Fidelity Sustainable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Sustainable EUR has no effect on the direction of Technology Select i.e., Technology Select and Fidelity Sustainable go up and down completely randomly.

Pair Corralation between Technology Select and Fidelity Sustainable

Considering the 90-day investment horizon Technology Select Sector is expected to generate 9.67 times more return on investment than Fidelity Sustainable. However, Technology Select is 9.67 times more volatile than Fidelity Sustainable EUR. It trades about 0.12 of its potential returns per unit of risk. Fidelity Sustainable EUR is currently generating about 0.04 per unit of risk. If you would invest  13,536  in Technology Select Sector on September 11, 2025 and sell it today you would earn a total of  1,266  from holding Technology Select Sector or generate 9.35% return on investment over 90 days.

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

Technology Select Sector  vs.  Fidelity Sustainable EUR

Technology Select Sector

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Technology Select Sector are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite weak essential indicators, Technology Select may actually be approaching a critical reversion point that can send shares even higher in January 2026.

Fidelity Sustainable EUR

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Fidelity Sustainable EUR are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Fidelity Sustainable is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Technology Select and Fidelity Sustainable

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

The idea behind Technology Select Sector and Fidelity Sustainable EUR 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.