Correlation Between MOVIE GAMES and Pfizer

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

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

Diversification Opportunities for MOVIE GAMES and Pfizer

-0.21

Correlation Coefficient

MOVIE GAMES  Pfizer

Very good diversification

The 3 months correlation between MOVIE and Pfizer is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding MOVIE GAMES SA and Pfizer Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pfizer Inc and MOVIE GAMES 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 MOVIE GAMES SA 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 MOVIE GAMES i.e., MOVIE GAMES and Pfizer go up and down completely randomly.

Pair Corralation between MOVIE GAMES and Pfizer

Assuming the 90 days horizon MOVIE GAMES SA is expected to generate 3.24 times more return on investment than Pfizer. However, MOVIE GAMES is 3.24 times more volatile than Pfizer Inc. It trades about 0.15 of its potential returns per unit of risk. Pfizer Inc is currently generating about -0.05 per unit of risk. If you would invest  297.00  in MOVIE GAMES SA on December 21, 2024 and sell it today you would earn a total of  107.00  from holding MOVIE GAMES SA or generate 36.03% return on investment over 90 days.

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

MOVIE GAMES SA  vs.  Pfizer Inc

MOVIE GAMES SA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in MOVIE GAMES SA are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, MOVIE GAMES reported solid returns over the last few months and may actually be approaching a breakup point.

Pfizer Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Pfizer Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Pfizer is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with MOVIE GAMES and Pfizer

The main advantage of trading using opposite MOVIE GAMES and Pfizer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MOVIE GAMES 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 MOVIE GAMES SA 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.