Correlation Between Merck and GENERAL
Specify exactly 2 symbols:
By analyzing existing cross correlation between Merck Company and GENERAL ELEC CAP, you can compare the effects of market volatilities on Merck and GENERAL 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 GENERAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merck and GENERAL.
Diversification Opportunities for Merck and GENERAL
Pay attention - limited upside
The 3 months correlation between Merck and GENERAL is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Merck Company and GENERAL ELEC CAP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GENERAL ELEC CAP 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 GENERAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GENERAL ELEC CAP has no effect on the direction of Merck i.e., Merck and GENERAL go up and down completely randomly.
Pair Corralation between Merck and GENERAL
If you would invest 0.00 in GENERAL ELEC CAP on August 31, 2024 and sell it today you would earn a total of 0.00 from holding GENERAL ELEC CAP or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 1.59% |
| Values | Daily Returns |
Merck Company vs. GENERAL ELEC CAP
Performance |
| Timeline |
| Merck Company |
| GENERAL ELEC CAP |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Merck and GENERAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merck and GENERAL
The main advantage of trading using opposite Merck and GENERAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merck position performs unexpectedly, GENERAL 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 GENERAL will offset losses from the drop in GENERAL's long position.The idea behind Merck Company and GENERAL ELEC CAP 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.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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |