Correlation Between MEET and EM
Can any of the company-specific risk be diversified away by investing in both MEET and EM 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 MEET and EM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MEET and EM, you can compare the effects of market volatilities on MEET and EM 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 MEET with a short position of EM. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEET and EM.
Diversification Opportunities for MEET and EM
Pay attention - limited upside
The 3 months correlation between MEET and EM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding MEET and EM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EM and MEET 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 MEET are associated (or correlated) with EM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EM has no effect on the direction of MEET i.e., MEET and EM go up and down completely randomly.
Pair Corralation between MEET and EM
If you would invest 0.03 in MEET on August 28, 2024 and sell it today you would earn a total of 0.00 from holding MEET or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.74% |
| Values | Daily Returns |
MEET vs. EM
Performance |
| Timeline |
| MEET |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| EM |
MEET and EM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MEET and EM
The main advantage of trading using opposite MEET and EM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MEET position performs unexpectedly, EM 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 EM will offset losses from the drop in EM's long position.The idea behind MEET and EM pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |