Correlation Between Synektik and Mercator Medical
Can any of the company-specific risk be diversified away by investing in both Synektik and Mercator Medical 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 Synektik and Mercator Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Synektik SA and Mercator Medical SA, you can compare the effects of market volatilities on Synektik and Mercator Medical 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 Synektik with a short position of Mercator Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Synektik and Mercator Medical.
Diversification Opportunities for Synektik and Mercator Medical
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Synektik and Mercator is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Synektik SA and Mercator Medical SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mercator Medical and Synektik 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 Synektik SA are associated (or correlated) with Mercator Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mercator Medical has no effect on the direction of Synektik i.e., Synektik and Mercator Medical go up and down completely randomly.
Pair Corralation between Synektik and Mercator Medical
Assuming the 90 days trading horizon Synektik SA is expected to generate 0.61 times more return on investment than Mercator Medical. However, Synektik SA is 1.64 times less risky than Mercator Medical. It trades about -0.22 of its potential returns per unit of risk. Mercator Medical SA is currently generating about -0.24 per unit of risk. If you would invest 18,500 in Synektik SA on August 29, 2024 and sell it today you would lose (1,420) from holding Synektik SA or give up 7.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Synektik SA vs. Mercator Medical SA
Performance |
| Timeline |
| Synektik SA |
| Mercator Medical |
Synektik and Mercator Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Synektik and Mercator Medical
The main advantage of trading using opposite Synektik and Mercator Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Synektik position performs unexpectedly, Mercator Medical 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 Mercator Medical will offset losses from the drop in Mercator Medical's long position.| Synektik vs. Mercator Medical SA | Synektik vs. Intersport Polska SA | Synektik vs. New Tech Venture | Synektik vs. LSI Software SA |
| Mercator Medical vs. Asseco Business Solutions | Mercator Medical vs. Detalion Games SA | Mercator Medical vs. CFI Holding SA | Mercator Medical vs. HM Inwest SA |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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