Correlation Between Capricor Therapeutics and Pfizer
Can any of the company-specific risk be diversified away by investing in both Capricor Therapeutics 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 Capricor Therapeutics and Pfizer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capricor Therapeutics and Pfizer Inc, you can compare the effects of market volatilities on Capricor Therapeutics 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 Capricor Therapeutics with a short position of Pfizer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capricor Therapeutics and Pfizer.
Diversification Opportunities for Capricor Therapeutics and Pfizer
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Capricor and Pfizer is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Capricor Therapeutics and Pfizer Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pfizer Inc and Capricor Therapeutics 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 Capricor Therapeutics 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 Capricor Therapeutics i.e., Capricor Therapeutics and Pfizer go up and down completely randomly.
Pair Corralation between Capricor Therapeutics and Pfizer
Given the investment horizon of 90 days Capricor Therapeutics is expected to generate 4.18 times more return on investment than Pfizer. However, Capricor Therapeutics is 4.18 times more volatile than Pfizer Inc. It trades about 0.09 of its potential returns per unit of risk. Pfizer Inc is currently generating about -0.04 per unit of risk. If you would invest 390.00 in Capricor Therapeutics on August 30, 2024 and sell it today you would earn a total of 1,514 from holding Capricor Therapeutics or generate 388.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capricor Therapeutics vs. Pfizer Inc
Performance |
| Timeline |
| Capricor Therapeutics |
| Pfizer Inc |
Capricor Therapeutics and Pfizer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capricor Therapeutics and Pfizer
The main advantage of trading using opposite Capricor Therapeutics and Pfizer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capricor Therapeutics 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.| Capricor Therapeutics vs. Bio Path Holdings | Capricor Therapeutics vs. NextCure | Capricor Therapeutics vs. Pulmatrix | Capricor Therapeutics vs. Akari Therapeutics PLC |
| Pfizer vs. Pharvaris BV | Pfizer vs. Brinker International | Pfizer vs. Alcoa Corp | Pfizer vs. Direxion Daily FTSE |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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