Correlation Between Pfizer and Celularity
Can any of the company-specific risk be diversified away by investing in both Pfizer and Celularity 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 Celularity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pfizer Inc and Celularity, you can compare the effects of market volatilities on Pfizer and Celularity 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 Celularity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pfizer and Celularity.
Diversification Opportunities for Pfizer and Celularity
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Pfizer and Celularity is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Pfizer Inc and Celularity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celularity 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 Celularity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celularity has no effect on the direction of Pfizer i.e., Pfizer and Celularity go up and down completely randomly.
Pair Corralation between Pfizer and Celularity
Considering the 90-day investment horizon Pfizer Inc is expected to under-perform the Celularity. But the stock apears to be less risky and, when comparing its historical volatility, Pfizer Inc is 13.0 times less risky than Celularity. The stock trades about -0.26 of its potential returns per unit of risk. The Celularity is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1.88 in Celularity on August 29, 2024 and sell it today you would lose (0.31) from holding Celularity or give up 16.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 86.96% |
| Values | Daily Returns |
Pfizer Inc vs. Celularity
Performance |
| Timeline |
| Pfizer Inc |
| Celularity |
Pfizer and Celularity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pfizer and Celularity
The main advantage of trading using opposite Pfizer and Celularity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pfizer position performs unexpectedly, Celularity 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 Celularity will offset losses from the drop in Celularity's long position.| Pfizer vs. Pharvaris BV | Pfizer vs. Brinker International | Pfizer vs. Alcoa Corp | Pfizer vs. Direxion Daily FTSE |
| Celularity vs. Bright Minds Biosciences | Celularity vs. HP Inc | Celularity vs. Intel | Celularity vs. Chevron Corp |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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