Correlation Between PFIZER and Aena SME
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By analyzing existing cross correlation between PFIZER INC 4125 and Aena SME SA, you can compare the effects of market volatilities on PFIZER and Aena SME 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 Aena SME. Check out your portfolio center. Please also check ongoing floating volatility patterns of PFIZER and Aena SME.
Diversification Opportunities for PFIZER and Aena SME
Very good diversification
The 3 months correlation between PFIZER and Aena is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding PFIZER INC 4125 and Aena SME SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aena SME SA 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 4125 are associated (or correlated) with Aena SME. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aena SME SA has no effect on the direction of PFIZER i.e., PFIZER and Aena SME go up and down completely randomly.
Pair Corralation between PFIZER and Aena SME
Assuming the 90 days trading horizon PFIZER INC 4125 is expected to generate 1.6 times more return on investment than Aena SME. However, PFIZER is 1.6 times more volatile than Aena SME SA. It trades about 0.23 of its potential returns per unit of risk. Aena SME SA is currently generating about -0.12 per unit of risk. If you would invest 8,371 in PFIZER INC 4125 on September 1, 2024 and sell it today you would earn a total of 904.00 from holding PFIZER INC 4125 or generate 10.8% 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 4125 vs. Aena SME SA
Performance |
| Timeline |
| PFIZER INC 4125 |
| Aena SME SA |
PFIZER and Aena SME Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PFIZER and Aena SME
The main advantage of trading using opposite PFIZER and Aena SME positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PFIZER position performs unexpectedly, Aena SME 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 Aena SME will offset losses from the drop in Aena SME's long position.The idea behind PFIZER INC 4125 and Aena SME SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Aena SME vs. UDR Inc | Aena SME vs. FactSet Research Systems | Aena SME vs. Netflix | Aena SME vs. Scottie Resources 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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