Correlation Between MeVis Medical and Simon Property
Can any of the company-specific risk be diversified away by investing in both MeVis Medical and Simon Property 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 Simon Property 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 Simon Property Group, you can compare the effects of market volatilities on MeVis Medical and Simon Property 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 Simon Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of MeVis Medical and Simon Property.
Diversification Opportunities for MeVis Medical and Simon Property
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MeVis and Simon is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding MeVis Medical Solutions and Simon Property Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simon Property Group 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 Simon Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simon Property Group has no effect on the direction of MeVis Medical i.e., MeVis Medical and Simon Property go up and down completely randomly.
Pair Corralation between MeVis Medical and Simon Property
Assuming the 90 days trading horizon MeVis Medical is expected to generate 14.73 times less return on investment than Simon Property. But when comparing it to its historical volatility, MeVis Medical Solutions is 2.0 times less risky than Simon Property. It trades about 0.05 of its potential returns per unit of risk. Simon Property Group is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 15,335 in Simon Property Group on September 4, 2024 and sell it today you would earn a total of 2,045 from holding Simon Property Group or generate 13.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
MeVis Medical Solutions vs. Simon Property Group
Performance |
| Timeline |
| MeVis Medical Solutions |
| Simon Property Group |
MeVis Medical and Simon Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MeVis Medical and Simon Property
The main advantage of trading using opposite MeVis Medical and Simon Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MeVis Medical position performs unexpectedly, Simon Property 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 Simon Property will offset losses from the drop in Simon Property's long position.| MeVis Medical vs. China Communications Services | MeVis Medical vs. Cogent Communications Holdings | MeVis Medical vs. CDL INVESTMENT | MeVis Medical vs. Iridium Communications |
| Simon Property vs. MeVis Medical Solutions | Simon Property vs. SAFETY MEDICAL PROD | Simon Property vs. Benchmark Electronics | Simon Property vs. AOI Electronics Co |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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