Correlation Between Brockhaus Capital and Merit Medical
Can any of the company-specific risk be diversified away by investing in both Brockhaus Capital 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 Brockhaus Capital and Merit Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brockhaus Capital Management and Merit Medical Systems, you can compare the effects of market volatilities on Brockhaus Capital 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 Brockhaus Capital with a short position of Merit Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brockhaus Capital and Merit Medical.
Diversification Opportunities for Brockhaus Capital and Merit Medical
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Brockhaus and Merit is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Brockhaus Capital Management 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 Brockhaus Capital 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 Brockhaus Capital Management 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 Brockhaus Capital i.e., Brockhaus Capital and Merit Medical go up and down completely randomly.
Pair Corralation between Brockhaus Capital and Merit Medical
Assuming the 90 days trading horizon Brockhaus Capital Management is expected to under-perform the Merit Medical. In addition to that, Brockhaus Capital is 1.92 times more volatile than Merit Medical Systems. It trades about -0.09 of its total potential returns per unit of risk. Merit Medical Systems is currently generating about 0.04 per unit of volatility. If you would invest 8,700 in Merit Medical Systems on December 10, 2024 and sell it today you would earn a total of 550.00 from holding Merit Medical Systems or generate 6.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brockhaus Capital Management vs. Merit Medical Systems
Performance |
| Timeline |
| Brockhaus Capital |
| Merit Medical Systems |
Brockhaus Capital and Merit Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brockhaus Capital and Merit Medical
The main advantage of trading using opposite Brockhaus Capital and Merit Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brockhaus Capital 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.| Brockhaus Capital vs. SOEDER SPORTFISKE AB | Brockhaus Capital vs. Transport International Holdings | Brockhaus Capital vs. Globe Trade Centre | Brockhaus Capital vs. CarsalesCom |
| Merit Medical vs. STRAYER EDUCATION | Merit Medical vs. Grand Canyon Education | Merit Medical vs. Zijin Mining Group | Merit Medical vs. Stag Industrial |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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