Correlation Between Mercator Medical and Comp SA
Can any of the company-specific risk be diversified away by investing in both Mercator Medical and Comp SA 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 Mercator Medical and Comp SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mercator Medical SA and Comp SA, you can compare the effects of market volatilities on Mercator Medical and Comp SA 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 Mercator Medical with a short position of Comp SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mercator Medical and Comp SA.
Diversification Opportunities for Mercator Medical and Comp SA
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mercator and Comp is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Mercator Medical SA and Comp SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comp SA and Mercator 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 Mercator Medical SA are associated (or correlated) with Comp SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comp SA has no effect on the direction of Mercator Medical i.e., Mercator Medical and Comp SA go up and down completely randomly.
Pair Corralation between Mercator Medical and Comp SA
Assuming the 90 days trading horizon Mercator Medical is expected to generate 8.18 times less return on investment than Comp SA. In addition to that, Mercator Medical is 1.43 times more volatile than Comp SA. It trades about 0.01 of its total potential returns per unit of risk. Comp SA is currently generating about 0.13 per unit of volatility. If you would invest 4,360 in Comp SA on September 3, 2024 and sell it today you would earn a total of 7,490 from holding Comp SA or generate 171.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mercator Medical SA vs. Comp SA
Performance |
| Timeline |
| Mercator Medical |
| Comp SA |
Mercator Medical and Comp SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mercator Medical and Comp SA
The main advantage of trading using opposite Mercator Medical and Comp SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mercator Medical position performs unexpectedly, Comp SA 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 Comp SA will offset losses from the drop in Comp SA's long position.| Mercator Medical vs. Cloud Technologies SA | Mercator Medical vs. Play2Chill SA | Mercator Medical vs. Quantum Software SA | Mercator Medical vs. Live Motion Games |
| Comp SA vs. Skyline Investment SA | Comp SA vs. Movie Games SA | Comp SA vs. Medicofarma Biotech SA | Comp SA vs. Varsav Game Studios |
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 Stocks Directory module to find actively traded stocks across global markets.
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