Correlation Between Pfizer and Select Fund
Can any of the company-specific risk be diversified away by investing in both Pfizer and Select Fund 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 Select Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pfizer Inc and Select Fund I, you can compare the effects of market volatilities on Pfizer and Select Fund 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 Select Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pfizer and Select Fund.
Diversification Opportunities for Pfizer and Select Fund
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Pfizer and Select is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Pfizer Inc and Select Fund I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Select Fund I 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 Select Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Select Fund I has no effect on the direction of Pfizer i.e., Pfizer and Select Fund go up and down completely randomly.
Pair Corralation between Pfizer and Select Fund
Considering the 90-day investment horizon Pfizer is expected to generate 1.47 times less return on investment than Select Fund. In addition to that, Pfizer is 1.68 times more volatile than Select Fund I. It trades about 0.12 of its total potential returns per unit of risk. Select Fund I is currently generating about 0.29 per unit of volatility. If you would invest 11,352 in Select Fund I on April 27, 2025 and sell it today you would earn a total of 2,085 from holding Select Fund I or generate 18.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pfizer Inc vs. Select Fund I
Performance |
| Timeline |
| Pfizer Inc |
| Select Fund I |
Pfizer and Select Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pfizer and Select Fund
The main advantage of trading using opposite Pfizer and Select Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pfizer position performs unexpectedly, Select Fund 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 Select Fund will offset losses from the drop in Select Fund's long position.| Pfizer vs. Pioneer Bankcorp | Pfizer vs. Foreign Trade Bank | Pfizer vs. Colony Bankcorp | Pfizer vs. Middlefield Banc |
| Select Fund vs. Ultra Fund I | Select Fund vs. International Growth Fund | Select Fund vs. Ultra Fund A | Select Fund vs. Value Fund I |
Check out your portfolio center.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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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