Correlation Between Merit Medical and SUPER HI
Can any of the company-specific risk be diversified away by investing in both Merit Medical and SUPER HI 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 SUPER HI 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 SUPER HI INTERNATIONAL, you can compare the effects of market volatilities on Merit Medical and SUPER HI 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 SUPER HI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merit Medical and SUPER HI.
Diversification Opportunities for Merit Medical and SUPER HI
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Merit and SUPER is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Merit Medical Systems and SUPER HI INTERNATIONAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUPER HI INTERNATIONAL 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 SUPER HI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUPER HI INTERNATIONAL has no effect on the direction of Merit Medical i.e., Merit Medical and SUPER HI go up and down completely randomly.
Pair Corralation between Merit Medical and SUPER HI
Given the investment horizon of 90 days Merit Medical Systems is expected to generate 0.33 times more return on investment than SUPER HI. However, Merit Medical Systems is 3.0 times less risky than SUPER HI. It trades about 0.13 of its potential returns per unit of risk. SUPER HI INTERNATIONAL is currently generating about 0.0 per unit of risk. If you would invest 6,878 in Merit Medical Systems on September 4, 2024 and sell it today you would earn a total of 3,604 from holding Merit Medical Systems or generate 52.4% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 55.87% |
Values | Daily Returns |
Merit Medical Systems vs. SUPER HI INTERNATIONAL
Performance |
Timeline |
Merit Medical Systems |
SUPER HI INTERNATIONAL |
Merit Medical and SUPER HI Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Merit Medical and SUPER HI
The main advantage of trading using opposite Merit Medical and SUPER HI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merit Medical position performs unexpectedly, SUPER HI 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 SUPER HI will offset losses from the drop in SUPER HI's long position.Merit Medical vs. Baxter International | Merit Medical vs. West Pharmaceutical Services | Merit Medical vs. ResMed Inc | Merit Medical vs. The Cooper Companies, |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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