Correlation Between Pfizer and Protalix Biotherapeutics
Can any of the company-specific risk be diversified away by investing in both Pfizer and Protalix Biotherapeutics 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 Protalix Biotherapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pfizer Inc and Protalix Biotherapeutics, you can compare the effects of market volatilities on Pfizer and Protalix Biotherapeutics 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 Protalix Biotherapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pfizer and Protalix Biotherapeutics.
Diversification Opportunities for Pfizer and Protalix Biotherapeutics
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Pfizer and Protalix is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Pfizer Inc and Protalix Biotherapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Protalix Biotherapeutics 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 Protalix Biotherapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Protalix Biotherapeutics has no effect on the direction of Pfizer i.e., Pfizer and Protalix Biotherapeutics go up and down completely randomly.
Pair Corralation between Pfizer and Protalix Biotherapeutics
Considering the 90-day investment horizon Pfizer Inc is expected to generate 0.36 times more return on investment than Protalix Biotherapeutics. However, Pfizer Inc is 2.74 times less risky than Protalix Biotherapeutics. It trades about -0.05 of its potential returns per unit of risk. Protalix Biotherapeutics is currently generating about -0.02 per unit of risk. If you would invest 3,502 in Pfizer Inc on August 27, 2024 and sell it today you would lose (937.00) from holding Pfizer Inc or give up 26.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pfizer Inc vs. Protalix Biotherapeutics
Performance |
| Timeline |
| Pfizer Inc |
| Protalix Biotherapeutics |
Pfizer and Protalix Biotherapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pfizer and Protalix Biotherapeutics
The main advantage of trading using opposite Pfizer and Protalix Biotherapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pfizer position performs unexpectedly, Protalix Biotherapeutics 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 Protalix Biotherapeutics will offset losses from the drop in Protalix Biotherapeutics' long position.| Pfizer vs. Capricor Therapeutics | Pfizer vs. Soleno Therapeutics | Pfizer vs. Bio Path Holdings | Pfizer vs. Moleculin Biotech |
| Protalix Biotherapeutics vs. Corvus Pharmaceuticals | Protalix Biotherapeutics vs. Aldeyra | Protalix Biotherapeutics vs. Checkpoint Therapeutics | Protalix Biotherapeutics vs. Cidara Therapeutics |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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