Correlation Between Merit Medical and Akanda Corp
Can any of the company-specific risk be diversified away by investing in both Merit Medical and Akanda Corp 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 Akanda Corp 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 Akanda Corp, you can compare the effects of market volatilities on Merit Medical and Akanda Corp 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 Akanda Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merit Medical and Akanda Corp.
Diversification Opportunities for Merit Medical and Akanda Corp
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Merit and Akanda is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Merit Medical Systems and Akanda Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akanda Corp 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 Akanda Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akanda Corp has no effect on the direction of Merit Medical i.e., Merit Medical and Akanda Corp go up and down completely randomly.
Pair Corralation between Merit Medical and Akanda Corp
Given the investment horizon of 90 days Merit Medical Systems is expected to generate 0.26 times more return on investment than Akanda Corp. However, Merit Medical Systems is 3.91 times less risky than Akanda Corp. It trades about 0.26 of its potential returns per unit of risk. Akanda Corp is currently generating about 0.04 per unit of risk. If you would invest 9,531 in Merit Medical Systems on August 29, 2024 and sell it today you would earn a total of 835.00 from holding Merit Medical Systems or generate 8.76% 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. Akanda Corp
Performance |
| Timeline |
| Merit Medical Systems |
| Akanda Corp |
Merit Medical and Akanda Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merit Medical and Akanda Corp
The main advantage of trading using opposite Merit Medical and Akanda Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merit Medical position performs unexpectedly, Akanda Corp 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 Akanda Corp will offset losses from the drop in Akanda Corp's long position.| Merit Medical vs. Femasys | Merit Medical vs. Sharps Technology Warrant | Merit Medical vs. GlucoTrack | Merit Medical vs. Walt Disney |
| Akanda Corp vs. Phibro Animal Health | Akanda Corp vs. Procaps Group SA | Akanda Corp vs. Amphastar P | Akanda Corp vs. Alkermes Plc |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |