Correlation Between Biztech Konsulting and Mercator Medical
Can any of the company-specific risk be diversified away by investing in both Biztech Konsulting and Mercator 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 Biztech Konsulting and Mercator Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biztech Konsulting SA and Mercator Medical SA, you can compare the effects of market volatilities on Biztech Konsulting and Mercator 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 Biztech Konsulting with a short position of Mercator Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biztech Konsulting and Mercator Medical.
Diversification Opportunities for Biztech Konsulting and Mercator Medical
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Biztech and Mercator is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Biztech Konsulting SA and Mercator Medical SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mercator Medical and Biztech Konsulting 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 Biztech Konsulting SA are associated (or correlated) with Mercator Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mercator Medical has no effect on the direction of Biztech Konsulting i.e., Biztech Konsulting and Mercator Medical go up and down completely randomly.
Pair Corralation between Biztech Konsulting and Mercator Medical
Assuming the 90 days trading horizon Biztech Konsulting SA is expected to generate 1.19 times more return on investment than Mercator Medical. However, Biztech Konsulting is 1.19 times more volatile than Mercator Medical SA. It trades about 0.03 of its potential returns per unit of risk. Mercator Medical SA is currently generating about 0.02 per unit of risk. If you would invest 16.00 in Biztech Konsulting SA on September 1, 2024 and sell it today you would earn a total of 1.00 from holding Biztech Konsulting SA or generate 6.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 89.76% |
| Values | Daily Returns |
Biztech Konsulting SA vs. Mercator Medical SA
Performance |
| Timeline |
| Biztech Konsulting |
| Mercator Medical |
Biztech Konsulting and Mercator Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biztech Konsulting and Mercator Medical
The main advantage of trading using opposite Biztech Konsulting and Mercator Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biztech Konsulting position performs unexpectedly, Mercator 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 Mercator Medical will offset losses from the drop in Mercator Medical's long position.| Biztech Konsulting vs. mBank SA | Biztech Konsulting vs. Medicalg | Biztech Konsulting vs. LSI Software SA | Biztech Konsulting vs. ING Bank lski |
| Mercator Medical vs. Asseco Business Solutions | Mercator Medical vs. Detalion Games SA | Mercator Medical vs. Asseco South Eastern | Mercator Medical vs. CFI Holding SA |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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