Correlation Between Pfizer and AER Energy
Can any of the company-specific risk be diversified away by investing in both Pfizer and AER Energy 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 AER Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pfizer Inc and AER Energy Resources, you can compare the effects of market volatilities on Pfizer and AER Energy 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 AER Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pfizer and AER Energy.
Diversification Opportunities for Pfizer and AER Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Pfizer and AER is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Pfizer Inc and AER Energy Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AER Energy Resources 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 AER Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AER Energy Resources has no effect on the direction of Pfizer i.e., Pfizer and AER Energy go up and down completely randomly.
Pair Corralation between Pfizer and AER Energy
Considering the 90-day investment horizon Pfizer Inc is expected to under-perform the AER Energy. But the stock apears to be less risky and, when comparing its historical volatility, Pfizer Inc is 35.36 times less risky than AER Energy. The stock trades about -0.02 of its potential returns per unit of risk. The AER Energy Resources is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 0.01 in AER Energy Resources on January 6, 2025 and sell it today you would lose (0.01) from holding AER Energy Resources or give up 100.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.15% |
| Values | Daily Returns |
Pfizer Inc vs. AER Energy Resources
Performance |
| Timeline |
| Pfizer Inc |
| AER Energy Resources |
Pfizer and AER Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pfizer and AER Energy
The main advantage of trading using opposite Pfizer and AER Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pfizer position performs unexpectedly, AER Energy 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 AER Energy will offset losses from the drop in AER Energy's long position.| Pfizer vs. Upper Street Marketing | Pfizer vs. Virtual Medical International | Pfizer vs. Grey Cloak Tech | Pfizer vs. CuraScientific Corp |
| AER Energy vs. Caduceus Software Systems | AER Energy vs. North Springs Resources | AER Energy vs. Nyxio Tech Corp | AER Energy vs. Access Power Co |
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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