Correlation Between CENTURIA OFFICE and Merit Medical
Can any of the company-specific risk be diversified away by investing in both CENTURIA OFFICE and Merit Medical 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 CENTURIA OFFICE and Merit Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CENTURIA OFFICE REIT and Merit Medical Systems, you can compare the effects of market volatilities on CENTURIA OFFICE and Merit Medical 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 CENTURIA OFFICE with a short position of Merit Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of CENTURIA OFFICE and Merit Medical.
Diversification Opportunities for CENTURIA OFFICE and Merit Medical
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between CENTURIA and Merit is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding CENTURIA OFFICE REIT and Merit Medical Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Merit Medical Systems and CENTURIA OFFICE 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 CENTURIA OFFICE REIT are associated (or correlated) with Merit Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Merit Medical Systems has no effect on the direction of CENTURIA OFFICE i.e., CENTURIA OFFICE and Merit Medical go up and down completely randomly.
Pair Corralation between CENTURIA OFFICE and Merit Medical
Assuming the 90 days horizon CENTURIA OFFICE is expected to generate 7.95 times less return on investment than Merit Medical. But when comparing it to its historical volatility, CENTURIA OFFICE REIT is 1.76 times less risky than Merit Medical. It trades about 0.06 of its potential returns per unit of risk. Merit Medical Systems is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 8,700 in Merit Medical Systems on August 29, 2024 and sell it today you would earn a total of 1,100 from holding Merit Medical Systems or generate 12.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CENTURIA OFFICE REIT vs. Merit Medical Systems
Performance |
| Timeline |
| CENTURIA OFFICE REIT |
| Merit Medical Systems |
CENTURIA OFFICE and Merit Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CENTURIA OFFICE and Merit Medical
The main advantage of trading using opposite CENTURIA OFFICE and Merit Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CENTURIA OFFICE position performs unexpectedly, Merit Medical 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 Merit Medical will offset losses from the drop in Merit Medical's long position.| CENTURIA OFFICE vs. Apple Inc | CENTURIA OFFICE vs. Apple Inc | CENTURIA OFFICE vs. Apple Inc | CENTURIA OFFICE vs. Apple Inc |
| Merit Medical vs. Apple Inc | Merit Medical vs. Apple Inc | Merit Medical vs. Apple Inc | Merit Medical vs. Apple Inc |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |