Correlation Between Garovaglio and Pfizer

Can any of the company-specific risk be diversified away by investing in both Garovaglio and Pfizer 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 Garovaglio and Pfizer into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Garovaglio y Zorraquin and Pfizer Inc, you can compare the effects of market volatilities on Garovaglio and Pfizer 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 Garovaglio with a short position of Pfizer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Garovaglio and Pfizer.

Diversification Opportunities for Garovaglio and Pfizer

-0.08

Correlation Coefficient

Garovaglio  Pfizer

Good diversification

The 3 months correlation between Garovaglio and Pfizer is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Garovaglio y Zorraquin and Pfizer Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pfizer Inc and Garovaglio 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 Garovaglio y Zorraquin are associated (or correlated) with Pfizer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pfizer Inc has no effect on the direction of Garovaglio i.e., Garovaglio and Pfizer go up and down completely randomly.

Pair Corralation between Garovaglio and Pfizer

Assuming the 90 days trading horizon Garovaglio y Zorraquin is expected to generate 1.09 times more return on investment than Pfizer. However, Garovaglio is 1.09 times more volatile than Pfizer Inc. It trades about 0.12 of its potential returns per unit of risk. Pfizer Inc is currently generating about 0.01 per unit of risk. If you would invest  3,150  in Garovaglio y Zorraquin on September 5, 2024 and sell it today you would earn a total of  16,425  from holding Garovaglio y Zorraquin or generate 521.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Garovaglio y Zorraquin  vs.  Pfizer Inc

Garovaglio y Zorraquin

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Garovaglio y Zorraquin are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Garovaglio sustained solid returns over the last few months and may actually be approaching a breakup point.

Pfizer Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pfizer Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Garovaglio and Pfizer

The main advantage of trading using opposite Garovaglio and Pfizer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Garovaglio position performs unexpectedly, Pfizer 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 Pfizer will offset losses from the drop in Pfizer's long position.

The idea behind Garovaglio y Zorraquin and Pfizer Inc 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.

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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 Commodity Directory module to find actively traded commodities issued by global exchanges.