Correlation Between Merck and Segall Bryant
Can any of the company-specific risk be diversified away by investing in both Merck and Segall Bryant 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 Merck and Segall Bryant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Merck Company and Segall Bryant Hamill, you can compare the effects of market volatilities on Merck and Segall Bryant 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 Segall Bryant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merck and Segall Bryant.
Diversification Opportunities for Merck and Segall Bryant
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Merck and Segall is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Merck Company and Segall Bryant Hamill in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Segall Bryant Hamill 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 Segall Bryant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Segall Bryant Hamill has no effect on the direction of Merck i.e., Merck and Segall Bryant go up and down completely randomly.
Pair Corralation between Merck and Segall Bryant
Considering the 90-day investment horizon Merck Company is expected to under-perform the Segall Bryant. In addition to that, Merck is 1.43 times more volatile than Segall Bryant Hamill. It trades about -0.02 of its total potential returns per unit of risk. Segall Bryant Hamill is currently generating about 0.38 per unit of volatility. If you would invest 3,087 in Segall Bryant Hamill on September 1, 2024 and sell it today you would earn a total of 237.00 from holding Segall Bryant Hamill or generate 7.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Merck Company vs. Segall Bryant Hamill
Performance |
| Timeline |
| Merck Company |
| Segall Bryant Hamill |
Merck and Segall Bryant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merck and Segall Bryant
The main advantage of trading using opposite Merck and Segall Bryant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merck position performs unexpectedly, Segall Bryant 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 Segall Bryant will offset losses from the drop in Segall Bryant's long position.The idea behind Merck Company and Segall Bryant Hamill 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.| Segall Bryant vs. FT Vest Equity | Segall Bryant vs. Northern Lights | Segall Bryant vs. Dimensional International High | Segall Bryant vs. Matthews China Discovery |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Stocks Directory Find actively traded stocks across global markets | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |