Correlation Between Bajaj Healthcare and Pfizer

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

By analyzing existing cross correlation between Bajaj Healthcare Limited and Pfizer Inc, you can compare the effects of market volatilities on Bajaj Healthcare 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 Bajaj Healthcare with a short position of Pfizer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bajaj Healthcare and Pfizer.

Diversification Opportunities for Bajaj Healthcare and Pfizer

-0.72

Correlation Coefficient

Bajaj Healthcare  Pfizer

Pay attention - limited upside

The 3 months correlation between Bajaj and Pfizer is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Bajaj Healthcare Limited and Pfizer Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pfizer Inc and Bajaj Healthcare 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 Bajaj Healthcare Limited 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 Bajaj Healthcare i.e., Bajaj Healthcare and Pfizer go up and down completely randomly.

Pair Corralation between Bajaj Healthcare and Pfizer

Assuming the 90 days trading horizon Bajaj Healthcare Limited is expected to under-perform the Pfizer. In addition to that, Bajaj Healthcare is 1.56 times more volatile than Pfizer Inc. It trades about -0.06 of its total potential returns per unit of risk. Pfizer Inc is currently generating about 0.03 per unit of volatility. If you would invest  2,303  in Pfizer Inc on May 5, 2025 and sell it today you would earn a total of  46.00  from holding Pfizer Inc or generate 2.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	95.45%
Values	Daily Returns

Bajaj Healthcare Limited  vs.  Pfizer Inc

Bajaj Healthcare

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bajaj Healthcare Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pfizer Inc

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Pfizer Inc are ranked lower than 2 (%) 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 current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Bajaj Healthcare and Pfizer

The main advantage of trading using opposite Bajaj Healthcare and Pfizer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bajaj Healthcare 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.

The idea behind Bajaj Healthcare Limited and Pfizer Inc 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.