Correlation Between Merit Medical and Sixt Leasing
Can any of the company-specific risk be diversified away by investing in both Merit Medical and Sixt Leasing 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 Merit Medical and Sixt Leasing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Merit Medical Systems and Sixt Leasing SE, you can compare the effects of market volatilities on Merit Medical and Sixt Leasing 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 Merit Medical with a short position of Sixt Leasing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merit Medical and Sixt Leasing.
Diversification Opportunities for Merit Medical and Sixt Leasing
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Merit and Sixt is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Merit Medical Systems and Sixt Leasing SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sixt Leasing SE and Merit 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 Merit Medical Systems are associated (or correlated) with Sixt Leasing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sixt Leasing SE has no effect on the direction of Merit Medical i.e., Merit Medical and Sixt Leasing go up and down completely randomly.
Pair Corralation between Merit Medical and Sixt Leasing
Assuming the 90 days trading horizon Merit Medical Systems is expected to generate 3.45 times more return on investment than Sixt Leasing. However, Merit Medical is 3.45 times more volatile than Sixt Leasing SE. It trades about 0.31 of its potential returns per unit of risk. Sixt Leasing SE is currently generating about 0.0 per unit of risk. If you would invest 9,300 in Merit Medical Systems on October 25, 2024 and sell it today you would earn a total of 650.00 from holding Merit Medical Systems or generate 6.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Merit Medical Systems vs. Sixt Leasing SE
Performance |
| Timeline |
| Merit Medical Systems |
| Sixt Leasing SE |
Merit Medical and Sixt Leasing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merit Medical and Sixt Leasing
The main advantage of trading using opposite Merit Medical and Sixt Leasing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merit Medical position performs unexpectedly, Sixt Leasing 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 Sixt Leasing will offset losses from the drop in Sixt Leasing's long position.| Merit Medical vs. Apple Inc | Merit Medical vs. Apple Inc | Merit Medical vs. Apple Inc | Merit Medical vs. Apple Inc |
| Sixt Leasing vs. Pembina Pipeline Corp | Sixt Leasing vs. PRECISION DRILLING P | Sixt Leasing vs. Southwest Airlines Co | Sixt Leasing vs. International Consolidated Airlines |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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