Correlation Between Pfizer and Summit Global

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

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

Diversification Opportunities for Pfizer and Summit Global

0.0

Correlation Coefficient

Pfizer  Summit Global

Pay attention - limited upside

The 3 months correlation between Pfizer and Summit is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Pfizer Inc and Summit Global Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Summit Global Investments 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 Summit Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Summit Global Investments has no effect on the direction of Pfizer i.e., Pfizer and Summit Global go up and down completely randomly.

Pair Corralation between Pfizer and Summit Global

If you would invest  2,535  in Pfizer Inc on December 19, 2024 and sell it today you would earn a total of  86.00  from holding Pfizer Inc or generate 3.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Pfizer Inc  vs.  Summit Global Investments

Pfizer Inc

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Pfizer Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Pfizer is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Summit Global Investments

Risk-Adjusted Performance

Very Weak

Over the last 90 days Summit Global Investments has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Summit Global 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 Summit Global

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

The idea behind Pfizer Inc and Summit Global Investments 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.