Correlation Between Pfizer and Golden Agri
Can any of the company-specific risk be diversified away by investing in both Pfizer and Golden Agri 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 Golden Agri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pfizer Inc and Golden Agri Resources, you can compare the effects of market volatilities on Pfizer and Golden Agri 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 Golden Agri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pfizer and Golden Agri.
Diversification Opportunities for Pfizer and Golden Agri
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Pfizer and Golden is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Pfizer Inc and Golden Agri Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Agri 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 Golden Agri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Agri Resources has no effect on the direction of Pfizer i.e., Pfizer and Golden Agri go up and down completely randomly.
Pair Corralation between Pfizer and Golden Agri
Considering the 90-day investment horizon Pfizer Inc is expected to under-perform the Golden Agri. But the stock apears to be less risky and, when comparing its historical volatility, Pfizer Inc is 4.27 times less risky than Golden Agri. The stock trades about -0.08 of its potential returns per unit of risk. The Golden Agri Resources is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 20.00 in Golden Agri Resources on September 3, 2024 and sell it today you would earn a total of 0.00 from holding Golden Agri Resources or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 65.05% |
| Values | Daily Returns |
Pfizer Inc vs. Golden Agri Resources
Performance |
| Timeline |
| Pfizer Inc |
| Golden Agri Resources |
Pfizer and Golden Agri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pfizer and Golden Agri
The main advantage of trading using opposite Pfizer and Golden Agri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pfizer position performs unexpectedly, Golden Agri 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 Golden Agri will offset losses from the drop in Golden Agri's long position.| Pfizer vs. Merck Company | Pfizer vs. Johnson Johnson | Pfizer vs. Highway Holdings Limited | Pfizer vs. QCR Holdings |
| Golden Agri vs. Wilmar International | Golden Agri vs. SLC Agricola SA | Golden Agri vs. Brasilagro Adr | Golden Agri vs. Alico Inc |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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