Correlation Between Mercator Medical and IMC SA
Can any of the company-specific risk be diversified away by investing in both Mercator Medical and IMC 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 IMC 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 IMC SA, you can compare the effects of market volatilities on Mercator Medical and IMC 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 IMC SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mercator Medical and IMC SA.
Diversification Opportunities for Mercator Medical and IMC SA
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mercator and IMC is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Mercator Medical SA and IMC SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IMC 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 IMC SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IMC SA has no effect on the direction of Mercator Medical i.e., Mercator Medical and IMC SA go up and down completely randomly.
Pair Corralation between Mercator Medical and IMC SA
Assuming the 90 days trading horizon Mercator Medical SA is expected to generate 0.95 times more return on investment than IMC SA. However, Mercator Medical SA is 1.05 times less risky than IMC SA. It trades about 0.03 of its potential returns per unit of risk. IMC SA is currently generating about 0.01 per unit of risk. If you would invest 4,230 in Mercator Medical SA on September 12, 2024 and sell it today you would earn a total of 880.00 from holding Mercator Medical SA or generate 20.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.72% |
| Values | Daily Returns |
Mercator Medical SA vs. IMC SA
Performance |
| Timeline |
| Mercator Medical |
| IMC SA |
Mercator Medical and IMC SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mercator Medical and IMC SA
The main advantage of trading using opposite Mercator Medical and IMC SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mercator Medical position performs unexpectedly, IMC 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 IMC SA will offset losses from the drop in IMC SA's long position.| Mercator Medical vs. Echo Investment SA | Mercator Medical vs. Movie Games SA | Mercator Medical vs. SOFTWARE MANSION SPOLKA | Mercator Medical vs. Quantum Software SA |
| IMC SA vs. LSI Software SA | IMC SA vs. Movie Games SA | IMC SA vs. Echo Investment SA | IMC SA vs. Carlson Investments SA |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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