Correlation Between Adimmune Corp and Merida Industry
Can any of the company-specific risk be diversified away by investing in both Adimmune Corp and Merida Industry 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 Adimmune Corp and Merida Industry into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Adimmune Corp and Merida Industry Co, you can compare the effects of market volatilities on Adimmune Corp and Merida Industry 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 Adimmune Corp with a short position of Merida Industry. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adimmune Corp and Merida Industry.
Diversification Opportunities for Adimmune Corp and Merida Industry
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Adimmune and Merida is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Adimmune Corp and Merida Industry Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Merida Industry and Adimmune Corp 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 Adimmune Corp are associated (or correlated) with Merida Industry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Merida Industry has no effect on the direction of Adimmune Corp i.e., Adimmune Corp and Merida Industry go up and down completely randomly.
Pair Corralation between Adimmune Corp and Merida Industry
Assuming the 90 days trading horizon Adimmune Corp is expected to under-perform the Merida Industry. But the stock apears to be less risky and, when comparing its historical volatility, Adimmune Corp is 1.67 times less risky than Merida Industry. The stock trades about -0.43 of its potential returns per unit of risk. The Merida Industry Co is currently generating about -0.19 of returns per unit of risk over similar time horizon. If you would invest 17,700 in Merida Industry Co on September 1, 2024 and sell it today you would lose (1,700) from holding Merida Industry Co or give up 9.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Adimmune Corp vs. Merida Industry Co
Performance |
| Timeline |
| Adimmune Corp |
| Merida Industry |
Adimmune Corp and Merida Industry Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adimmune Corp and Merida Industry
The main advantage of trading using opposite Adimmune Corp and Merida Industry positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adimmune Corp position performs unexpectedly, Merida Industry 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 Merida Industry will offset losses from the drop in Merida Industry's long position.| Adimmune Corp vs. Medigen Vaccine Biologics | Adimmune Corp vs. SCI Pharmtech | Adimmune Corp vs. Chunghwa Chemical Synthesis | Adimmune Corp vs. ScinoPharm Taiwan |
| Merida Industry vs. Chaintech Technology Corp | Merida Industry vs. AVerMedia Technologies | Merida Industry vs. Avision | Merida Industry vs. Clevo Co |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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