Correlation Between Merck and IShares Exponential
Can any of the company-specific risk be diversified away by investing in both Merck and IShares Exponential 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 IShares Exponential into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Merck Company and iShares Exponential Technologies, you can compare the effects of market volatilities on Merck and IShares Exponential 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 IShares Exponential. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merck and IShares Exponential.
Diversification Opportunities for Merck and IShares Exponential
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Merck and IShares is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Merck Company and iShares Exponential Technologi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Exponential 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 IShares Exponential. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Exponential has no effect on the direction of Merck i.e., Merck and IShares Exponential go up and down completely randomly.
Pair Corralation between Merck and IShares Exponential
Considering the 90-day investment horizon Merck Company is expected to under-perform the IShares Exponential. In addition to that, Merck is 1.07 times more volatile than iShares Exponential Technologies. It trades about 0.0 of its total potential returns per unit of risk. iShares Exponential Technologies is currently generating about 0.04 per unit of volatility. If you would invest 4,917 in iShares Exponential Technologies on August 27, 2024 and sell it today you would earn a total of 1,165 from holding iShares Exponential Technologies or generate 23.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Merck Company vs. iShares Exponential Technologi
Performance |
| Timeline |
| Merck Company |
| iShares Exponential |
Merck and IShares Exponential Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merck and IShares Exponential
The main advantage of trading using opposite Merck and IShares Exponential positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merck position performs unexpectedly, IShares Exponential 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 IShares Exponential will offset losses from the drop in IShares Exponential's long position.| Merck vs. Capricor Therapeutics | Merck vs. Soleno Therapeutics | Merck vs. Bio Path Holdings | Merck vs. Moleculin Biotech |
| IShares Exponential vs. SPDR Kensho New | IShares Exponential vs. Global X FinTech | IShares Exponential vs. Invesco SP SmallCap | IShares Exponential vs. iShares Genomics Immunology |
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.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| CEOs Directory Screen CEOs from public companies around the world |