Correlation Between Agrometal SAI and Pfizer
Can any of the company-specific risk be diversified away by investing in both Agrometal SAI and Pfizer 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 Agrometal SAI and Pfizer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agrometal SAI and Pfizer Inc, you can compare the effects of market volatilities on Agrometal SAI and Pfizer 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 Agrometal SAI with a short position of Pfizer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agrometal SAI and Pfizer.
Diversification Opportunities for Agrometal SAI and Pfizer
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Agrometal and Pfizer is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Agrometal SAI and Pfizer Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pfizer Inc and Agrometal SAI 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 Agrometal SAI are associated (or correlated) with Pfizer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pfizer Inc has no effect on the direction of Agrometal SAI i.e., Agrometal SAI and Pfizer go up and down completely randomly.
Pair Corralation between Agrometal SAI and Pfizer
Assuming the 90 days trading horizon Agrometal SAI is expected to generate 1.4 times more return on investment than Pfizer. However, Agrometal SAI is 1.4 times more volatile than Pfizer Inc. It trades about 0.1 of its potential returns per unit of risk. Pfizer Inc is currently generating about -0.09 per unit of risk. If you would invest 5,420 in Agrometal SAI on August 24, 2024 and sell it today you would earn a total of 1,920 from holding Agrometal SAI or generate 35.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agrometal SAI vs. Pfizer Inc
Performance |
| Timeline |
| Agrometal SAI |
| Pfizer Inc |
Agrometal SAI and Pfizer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agrometal SAI and Pfizer
The main advantage of trading using opposite Agrometal SAI and Pfizer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agrometal SAI position performs unexpectedly, Pfizer 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 Pfizer will offset losses from the drop in Pfizer's long position.| Agrometal SAI vs. United States Steel | Agrometal SAI vs. Harmony Gold Mining | Agrometal SAI vs. Transportadora de Gas | Agrometal SAI vs. Compania de Transporte |
| Pfizer vs. United States Steel | Pfizer vs. Transportadora de Gas | Pfizer vs. Agrometal SAI | Pfizer vs. Harmony Gold Mining |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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