Correlation Between Meta Platforms and Pfizer
Can any of the company-specific risk be diversified away by investing in both Meta Platforms and Pfizer 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 Meta Platforms and Pfizer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Meta Platforms and Pfizer Inc, you can compare the effects of market volatilities on Meta Platforms and Pfizer 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 Meta Platforms with a short position of Pfizer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meta Platforms and Pfizer.
Diversification Opportunities for Meta Platforms and Pfizer
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Meta and Pfizer is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Meta Platforms and Pfizer Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pfizer Inc and Meta Platforms 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 Meta Platforms are associated (or correlated) with Pfizer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pfizer Inc has no effect on the direction of Meta Platforms i.e., Meta Platforms and Pfizer go up and down completely randomly.
Pair Corralation between Meta Platforms and Pfizer
If you would invest 16,949 in Meta Platforms on January 26, 2024 and sell it today you would earn a total of 0.00 from holding Meta Platforms or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 4.76% |
Values | Daily Returns |
Meta Platforms vs. Pfizer Inc
Performance |
Timeline |
Meta Platforms |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Pfizer Inc |
Meta Platforms and Pfizer Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Meta Platforms and Pfizer
The main advantage of trading using opposite Meta Platforms and Pfizer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meta Platforms position performs unexpectedly, Pfizer 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 Pfizer will offset losses from the drop in Pfizer's long position.Meta Platforms vs. Meta Platforms | Meta Platforms vs. Alphabet Inc Class A | Meta Platforms vs. Twilio Inc | Meta Platforms vs. Snap Inc |
Pfizer vs. AbbVie Inc | Pfizer vs. Merck Company | Pfizer vs. Eli Lilly and | Pfizer vs. Bristol Myers Squibb |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |