Correlation Between Ecovyst and Merit Medical
Can any of the company-specific risk be diversified away by investing in both Ecovyst 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 Ecovyst and Merit Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecovyst and Merit Medical Systems, you can compare the effects of market volatilities on Ecovyst 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 Ecovyst with a short position of Merit Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecovyst and Merit Medical.
Diversification Opportunities for Ecovyst and Merit Medical
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ecovyst and Merit is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Ecovyst 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 Ecovyst 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 Ecovyst 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 Ecovyst i.e., Ecovyst and Merit Medical go up and down completely randomly.
Pair Corralation between Ecovyst and Merit Medical
Given the investment horizon of 90 days Ecovyst is expected to generate 1.06 times more return on investment than Merit Medical. However, Ecovyst is 1.06 times more volatile than Merit Medical Systems. It trades about 0.16 of its potential returns per unit of risk. Merit Medical Systems is currently generating about -0.17 per unit of risk. If you would invest 772.00 in Ecovyst on November 28, 2024 and sell it today you would earn a total of 38.00 from holding Ecovyst or generate 4.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ecovyst vs. Merit Medical Systems
Performance |
| Timeline |
| Ecovyst |
| Merit Medical Systems |
Ecovyst and Merit Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecovyst and Merit Medical
The main advantage of trading using opposite Ecovyst and Merit Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecovyst 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.| Ecovyst vs. Orion Engineered Carbons | Ecovyst vs. Cabot | Ecovyst vs. Minerals Technologies | Ecovyst vs. Quaker Chemical |
| Merit Medical vs. Teleflex Incorporated | Merit Medical vs. The Cooper Companies, | Merit Medical vs. West Pharmaceutical Services | Merit Medical vs. ICU Medical |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |