Correlation Between Pfizer and Halliburton
Can any of the company-specific risk be diversified away by investing in both Pfizer and Halliburton 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 Pfizer and Halliburton into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pfizer Inc and Halliburton Co, you can compare the effects of market volatilities on Pfizer and Halliburton 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 Pfizer with a short position of Halliburton. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pfizer and Halliburton.
Diversification Opportunities for Pfizer and Halliburton
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Pfizer and Halliburton is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Pfizer Inc and Halliburton Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Halliburton and Pfizer 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 Pfizer Inc are associated (or correlated) with Halliburton. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Halliburton has no effect on the direction of Pfizer i.e., Pfizer and Halliburton go up and down completely randomly.
Pair Corralation between Pfizer and Halliburton
Assuming the 90 days trading horizon Pfizer Inc is expected to generate 0.57 times more return on investment than Halliburton. However, Pfizer Inc is 1.74 times less risky than Halliburton. It trades about 0.04 of its potential returns per unit of risk. Halliburton Co is currently generating about -0.09 per unit of risk. If you would invest 784,000 in Pfizer Inc on November 2, 2024 and sell it today you would earn a total of 6,000 from holding Pfizer Inc or generate 0.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pfizer Inc vs. Halliburton Co
Performance |
| Timeline |
| Pfizer Inc |
| Halliburton |
Pfizer and Halliburton Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pfizer and Halliburton
The main advantage of trading using opposite Pfizer and Halliburton positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pfizer position performs unexpectedly, Halliburton 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 Halliburton will offset losses from the drop in Halliburton's long position.| Pfizer vs. Telecom Argentina | Pfizer vs. Harmony Gold Mining | Pfizer vs. Transportadora de Gas | Pfizer vs. Agrometal SAI |
| Halliburton vs. Edesa Holding SA | Halliburton vs. Boldt SA | Halliburton vs. Agrometal SAI | Halliburton vs. United States Steel |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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