Correlation Between Pfizer and Oklahoma College

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

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

Diversification Opportunities for Pfizer and Oklahoma College

-0.55

Correlation Coefficient

Pfizer  Oklahoma College

Excellent diversification

The 3 months correlation between Pfizer and Oklahoma is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Pfizer Inc and Oklahoma College Savings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oklahoma College Savings 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 Oklahoma College. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oklahoma College Savings has no effect on the direction of Pfizer i.e., Pfizer and Oklahoma College go up and down completely randomly.

Pair Corralation between Pfizer and Oklahoma College

Considering the 90-day investment horizon Pfizer Inc is expected to under-perform the Oklahoma College. But the stock apears to be less risky and, when comparing its historical volatility, Pfizer Inc is 1.22 times less risky than Oklahoma College. The stock trades about -0.12 of its potential returns per unit of risk. The Oklahoma College Savings is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  1,964  in Oklahoma College Savings on October 23, 2024 and sell it today you would earn a total of  58.00  from holding Oklahoma College Savings or generate 2.95% 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.  Oklahoma College Savings

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 latest unsteady performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Oklahoma College Savings

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Oklahoma College Savings are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward-looking signals, Oklahoma College is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Pfizer and Oklahoma College

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

The idea behind Pfizer Inc and Oklahoma College Savings 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.