Correlation Between Pfizer and IndexIQ
Can any of the company-specific risk be diversified away by investing in both Pfizer and IndexIQ 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 IndexIQ into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pfizer Inc and IndexIQ, you can compare the effects of market volatilities on Pfizer and IndexIQ 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 IndexIQ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pfizer and IndexIQ.
Diversification Opportunities for Pfizer and IndexIQ
Pay attention - limited upside
The 3 months correlation between Pfizer and IndexIQ is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Pfizer Inc and IndexIQ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IndexIQ 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 IndexIQ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IndexIQ has no effect on the direction of Pfizer i.e., Pfizer and IndexIQ go up and down completely randomly.
Pair Corralation between Pfizer and IndexIQ
If you would invest (100.00) in IndexIQ on January 10, 2025 and sell it today you would earn a total of 100.00 from holding IndexIQ or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Pfizer Inc vs. IndexIQ
Performance |
| Timeline |
| Pfizer Inc |
| IndexIQ |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Pfizer and IndexIQ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pfizer and IndexIQ
The main advantage of trading using opposite Pfizer and IndexIQ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pfizer position performs unexpectedly, IndexIQ 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 IndexIQ will offset losses from the drop in IndexIQ's long position.| Pfizer vs. AbbVie Inc | Pfizer vs. Merck Company | Pfizer vs. Eli Lilly and | Pfizer vs. Bristol Myers Squibb |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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