Correlation Between Pfizer and Columbia ETF
Can any of the company-specific risk be diversified away by investing in both Pfizer and Columbia ETF 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 Columbia ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pfizer Inc and Columbia ETF Trust, you can compare the effects of market volatilities on Pfizer and Columbia ETF 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 Columbia ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pfizer and Columbia ETF.
Diversification Opportunities for Pfizer and Columbia ETF
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Pfizer and Columbia is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Pfizer Inc and Columbia ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia ETF Trust 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 Columbia ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia ETF Trust has no effect on the direction of Pfizer i.e., Pfizer and Columbia ETF go up and down completely randomly.
Pair Corralation between Pfizer and Columbia ETF
Considering the 90-day investment horizon Pfizer is expected to generate 4.36 times less return on investment than Columbia ETF. In addition to that, Pfizer is 1.89 times more volatile than Columbia ETF Trust. It trades about 0.01 of its total potential returns per unit of risk. Columbia ETF Trust is currently generating about 0.11 per unit of volatility. If you would invest 2,897 in Columbia ETF Trust on November 3, 2024 and sell it today you would earn a total of 658.00 from holding Columbia ETF Trust or generate 22.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pfizer Inc vs. Columbia ETF Trust
Performance |
| Timeline |
| Pfizer Inc |
| Columbia ETF Trust |
Pfizer and Columbia ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pfizer and Columbia ETF
The main advantage of trading using opposite Pfizer and Columbia ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pfizer position performs unexpectedly, Columbia ETF 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 Columbia ETF will offset losses from the drop in Columbia ETF's long position.| Pfizer vs. AbbVie Inc | Pfizer vs. Merck Company | Pfizer vs. Bristol Myers Squibb | Pfizer vs. Johnson Johnson |
| Columbia ETF vs. Columbia Research Enhanced | Columbia ETF vs. RiverFront Dynamic Flex Cap | Columbia ETF vs. PIMCO RAFI ESG | Columbia ETF vs. DBX ETF Trust |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Commodity Directory Find actively traded commodities issued by global exchanges |