Correlation Between MeVis Medical and EVS Broadcast
Can any of the company-specific risk be diversified away by investing in both MeVis Medical and EVS Broadcast 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 MeVis Medical and EVS Broadcast into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MeVis Medical Solutions and EVS Broadcast Equipment, you can compare the effects of market volatilities on MeVis Medical and EVS Broadcast 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 MeVis Medical with a short position of EVS Broadcast. Check out your portfolio center. Please also check ongoing floating volatility patterns of MeVis Medical and EVS Broadcast.
Diversification Opportunities for MeVis Medical and EVS Broadcast
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MeVis and EVS is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding MeVis Medical Solutions and EVS Broadcast Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EVS Broadcast Equipment and MeVis Medical 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 MeVis Medical Solutions are associated (or correlated) with EVS Broadcast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EVS Broadcast Equipment has no effect on the direction of MeVis Medical i.e., MeVis Medical and EVS Broadcast go up and down completely randomly.
Pair Corralation between MeVis Medical and EVS Broadcast
Assuming the 90 days trading horizon MeVis Medical is expected to generate 1.01 times less return on investment than EVS Broadcast. In addition to that, MeVis Medical is 1.12 times more volatile than EVS Broadcast Equipment. It trades about 0.18 of its total potential returns per unit of risk. EVS Broadcast Equipment is currently generating about 0.21 per unit of volatility. If you would invest 2,950 in EVS Broadcast Equipment on October 11, 2024 and sell it today you would earn a total of 125.00 from holding EVS Broadcast Equipment or generate 4.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MeVis Medical Solutions vs. EVS Broadcast Equipment
Performance |
| Timeline |
| MeVis Medical Solutions |
| EVS Broadcast Equipment |
MeVis Medical and EVS Broadcast Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MeVis Medical and EVS Broadcast
The main advantage of trading using opposite MeVis Medical and EVS Broadcast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MeVis Medical position performs unexpectedly, EVS Broadcast 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 EVS Broadcast will offset losses from the drop in EVS Broadcast's long position.| MeVis Medical vs. China Datang | MeVis Medical vs. DATATEC LTD 2 | MeVis Medical vs. Tsingtao Brewery | MeVis Medical vs. Cass Information Systems |
| EVS Broadcast vs. OBSERVE MEDICAL ASA | EVS Broadcast vs. Advanced Medical Solutions | EVS Broadcast vs. MeVis Medical Solutions | EVS Broadcast vs. PKSHA TECHNOLOGY 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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