Correlation Between MeVis Medical and PPG Industries
Can any of the company-specific risk be diversified away by investing in both MeVis Medical and PPG Industries 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 PPG Industries 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 PPG Industries, you can compare the effects of market volatilities on MeVis Medical and PPG Industries 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 PPG Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of MeVis Medical and PPG Industries.
Diversification Opportunities for MeVis Medical and PPG Industries
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MeVis and PPG is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding MeVis Medical Solutions and PPG Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PPG Industries 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 PPG Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PPG Industries has no effect on the direction of MeVis Medical i.e., MeVis Medical and PPG Industries go up and down completely randomly.
Pair Corralation between MeVis Medical and PPG Industries
Assuming the 90 days trading horizon MeVis Medical Solutions is expected to generate 0.63 times more return on investment than PPG Industries. However, MeVis Medical Solutions is 1.59 times less risky than PPG Industries. It trades about 0.25 of its potential returns per unit of risk. PPG Industries is currently generating about 0.11 per unit of risk. If you would invest 2,400 in MeVis Medical Solutions on October 24, 2024 and sell it today you would earn a total of 80.00 from holding MeVis Medical Solutions or generate 3.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
MeVis Medical Solutions vs. PPG Industries
Performance |
| Timeline |
| MeVis Medical Solutions |
| PPG Industries |
MeVis Medical and PPG Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MeVis Medical and PPG Industries
The main advantage of trading using opposite MeVis Medical and PPG Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MeVis Medical position performs unexpectedly, PPG Industries 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 PPG Industries will offset losses from the drop in PPG Industries' long position.| MeVis Medical vs. GRIFFIN MINING LTD | MeVis Medical vs. SPORT LISBOA E | MeVis Medical vs. USWE SPORTS AB | MeVis Medical vs. Harmony Gold Mining |
| PPG Industries vs. Ringmetall SE | PPG Industries vs. Jacquet Metal Service | PPG Industries vs. GRIFFIN MINING LTD | PPG Industries vs. The Home Depot |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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