Correlation Between Merck and EQUITABLE
Specify exactly 2 symbols:
By analyzing existing cross correlation between Merck Company and EQUITABLE INC 7, you can compare the effects of market volatilities on Merck and EQUITABLE 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 Merck with a short position of EQUITABLE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merck and EQUITABLE.
Diversification Opportunities for Merck and EQUITABLE
Poor diversification
The 3 months correlation between Merck and EQUITABLE is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Merck Company and EQUITABLE INC 7 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EQUITABLE INC 7 and Merck 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 Merck Company are associated (or correlated) with EQUITABLE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EQUITABLE INC 7 has no effect on the direction of Merck i.e., Merck and EQUITABLE go up and down completely randomly.
Pair Corralation between Merck and EQUITABLE
Considering the 90-day investment horizon Merck Company is expected to generate 2.3 times more return on investment than EQUITABLE. However, Merck is 2.3 times more volatile than EQUITABLE INC 7. It trades about 0.0 of its potential returns per unit of risk. EQUITABLE INC 7 is currently generating about -0.12 per unit of risk. If you would invest 10,188 in Merck Company on September 2, 2024 and sell it today you would lose (24.00) from holding Merck Company or give up 0.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 76.19% |
| Values | Daily Returns |
Merck Company vs. EQUITABLE INC 7
Performance |
| Timeline |
| Merck Company |
| EQUITABLE INC 7 |
Merck and EQUITABLE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merck and EQUITABLE
The main advantage of trading using opposite Merck and EQUITABLE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merck position performs unexpectedly, EQUITABLE 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 EQUITABLE will offset losses from the drop in EQUITABLE's long position.The idea behind Merck Company and EQUITABLE INC 7 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| EQUITABLE vs. Scandinavian Tobacco Group | EQUITABLE vs. Vita Coco | EQUITABLE vs. Acme United | EQUITABLE vs. Westrock Coffee |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |