Correlation Between Pfizer and ETF Series

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

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

Diversification Opportunities for Pfizer and ETF Series

-0.89

Correlation Coefficient

Pfizer  ETF Series

Pay attention - limited upside

The 3 months correlation between Pfizer and ETF is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding Pfizer Inc and ETF Series Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ETF Series Solutions 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 ETF Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ETF Series Solutions has no effect on the direction of Pfizer i.e., Pfizer and ETF Series go up and down completely randomly.

Pair Corralation between Pfizer and ETF Series

Considering the 90-day investment horizon Pfizer Inc is expected to under-perform the ETF Series. In addition to that, Pfizer is 10.05 times more volatile than ETF Series Solutions. It trades about -0.06 of its total potential returns per unit of risk. ETF Series Solutions is currently generating about 0.2 per unit of volatility. If you would invest  2,274  in ETF Series Solutions on September 16, 2024 and sell it today you would earn a total of  264.00  from holding ETF Series Solutions or generate 11.61% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	80.29%
Values	Daily Returns

Pfizer Inc  vs.  ETF Series Solutions

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 uncertain performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

ETF Series Solutions

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in ETF Series Solutions are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable forward indicators, ETF Series is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Pfizer and ETF Series

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

The idea behind Pfizer Inc and ETF Series Solutions 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.