Correlation Between Pfizer and Sharp Corp

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

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

Diversification Opportunities for Pfizer and Sharp Corp

-0.36

Correlation Coefficient

Pfizer  Sharp Corp

Very good diversification

The 3 months correlation between Pfizer and Sharp is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Pfizer Inc and Sharp Corp ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sharp Corp ADR 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 Sharp Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sharp Corp ADR has no effect on the direction of Pfizer i.e., Pfizer and Sharp Corp go up and down completely randomly.

Pair Corralation between Pfizer and Sharp Corp

Considering the 90-day investment horizon Pfizer is expected to generate 1.13 times less return on investment than Sharp Corp. But when comparing it to its historical volatility, Pfizer Inc is 1.62 times less risky than Sharp Corp. It trades about 0.12 of its potential returns per unit of risk. Sharp Corp ADR is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  132.00  in Sharp Corp ADR on May 18, 2025 and sell it today you would earn a total of  15.00  from holding Sharp Corp ADR or generate 11.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Pfizer Inc  vs.  Sharp Corp ADR

Pfizer Inc

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Pfizer Inc are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather abnormal technical and fundamental indicators, Pfizer may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Sharp Corp ADR

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Sharp Corp ADR are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Sharp Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Pfizer and Sharp Corp

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

The idea behind Pfizer Inc and Sharp Corp ADR 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.