Correlation Between Merck and 404280AE9
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By analyzing existing cross correlation between Merck Company and HSBC HLDGS PLC, you can compare the effects of market volatilities on Merck and 404280AE9 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 404280AE9. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merck and 404280AE9.
Diversification Opportunities for Merck and 404280AE9
Very good diversification
The 3 months correlation between Merck and 404280AE9 is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Merck Company and HSBC HLDGS PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HSBC HLDGS PLC 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 404280AE9. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HSBC HLDGS PLC has no effect on the direction of Merck i.e., Merck and 404280AE9 go up and down completely randomly.
Pair Corralation between Merck and 404280AE9
Considering the 90-day investment horizon Merck Company is expected to generate 0.28 times more return on investment than 404280AE9. However, Merck Company is 3.57 times less risky than 404280AE9. It trades about -0.18 of its potential returns per unit of risk. HSBC HLDGS PLC is currently generating about -0.35 per unit of risk. If you would invest 10,423 in Merck Company on August 27, 2024 and sell it today you would lose (505.00) from holding Merck Company or give up 4.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 28.57% |
| Values | Daily Returns |
Merck Company vs. HSBC HLDGS PLC
Performance |
| Timeline |
| Merck Company |
| HSBC HLDGS PLC |
Merck and 404280AE9 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merck and 404280AE9
The main advantage of trading using opposite Merck and 404280AE9 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merck position performs unexpectedly, 404280AE9 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 404280AE9 will offset losses from the drop in 404280AE9's long position.| Merck vs. Capricor Therapeutics | Merck vs. Soleno Therapeutics | Merck vs. Bio Path Holdings | Merck vs. Moleculin Biotech |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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