Correlation Between Merit Medical and Codiak BioSciences
Can any of the company-specific risk be diversified away by investing in both Merit Medical and Codiak BioSciences 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 Codiak BioSciences 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 Codiak BioSciences, you can compare the effects of market volatilities on Merit Medical and Codiak BioSciences 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 Codiak BioSciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merit Medical and Codiak BioSciences.
Diversification Opportunities for Merit Medical and Codiak BioSciences
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Merit and Codiak is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Merit Medical Systems and Codiak BioSciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Codiak BioSciences 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 Codiak BioSciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Codiak BioSciences has no effect on the direction of Merit Medical i.e., Merit Medical and Codiak BioSciences go up and down completely randomly.
Pair Corralation between Merit Medical and Codiak BioSciences
If you would invest 8,092 in Merit Medical Systems on August 28, 2024 and sell it today you would earn a total of 2,400 from holding Merit Medical Systems or generate 29.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Merit Medical Systems vs. Codiak BioSciences
Performance |
| Timeline |
| Merit Medical Systems |
| Codiak BioSciences |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Merit Medical and Codiak BioSciences Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merit Medical and Codiak BioSciences
The main advantage of trading using opposite Merit Medical and Codiak BioSciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merit Medical position performs unexpectedly, Codiak BioSciences 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 Codiak BioSciences will offset losses from the drop in Codiak BioSciences' long position.| Merit Medical vs. Nutex Health | Merit Medical vs. Mangoceuticals, Common Stock | Merit Medical vs. Aclarion |
| Codiak BioSciences vs. Hurco Companies | Codiak BioSciences vs. KNOT Offshore Partners | Codiak BioSciences vs. Taiwan Semiconductor Manufacturing | Codiak BioSciences vs. Cementos Pacasmayo SAA |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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