Correlation Between Pfizer and CI GAMES

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

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

Diversification Opportunities for Pfizer and CI GAMES

0.52

Correlation Coefficient

Pfizer  CI GAMES

Very weak diversification

The 3 months correlation between Pfizer and CI7 is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Pfizer Inc and CI GAMES SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI GAMES 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 are associated (or correlated) with CI GAMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI GAMES SA has no effect on the direction of Pfizer i.e., Pfizer and CI GAMES go up and down completely randomly.

Pair Corralation between Pfizer and CI GAMES

Assuming the 90 days trading horizon Pfizer Inc is expected to generate 0.47 times more return on investment than CI GAMES. However, Pfizer Inc is 2.11 times less risky than CI GAMES. It trades about 0.08 of its potential returns per unit of risk. CI GAMES SA is currently generating about -0.32 per unit of risk. If you would invest  2,468  in Pfizer Inc on September 24, 2024 and sell it today you would earn a total of  54.00  from holding Pfizer Inc or generate 2.19% return on investment over 90 days.

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

Pfizer Inc  vs.  CI GAMES SA

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. 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.

CI GAMES SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CI GAMES SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Pfizer and CI GAMES

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

The idea behind Pfizer Inc and CI GAMES 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.

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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.