Correlation Between UniCredit SpA and Mercator Medical
Can any of the company-specific risk be diversified away by investing in both UniCredit SpA 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 UniCredit SpA and Mercator Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UniCredit SpA and Mercator Medical SA, you can compare the effects of market volatilities on UniCredit SpA 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 UniCredit SpA with a short position of Mercator Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of UniCredit SpA and Mercator Medical.
Diversification Opportunities for UniCredit SpA and Mercator Medical
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between UniCredit and Mercator is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding UniCredit SpA and Mercator Medical SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mercator Medical and UniCredit SpA 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 UniCredit SpA 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 UniCredit SpA i.e., UniCredit SpA and Mercator Medical go up and down completely randomly.
Pair Corralation between UniCredit SpA and Mercator Medical
Assuming the 90 days trading horizon UniCredit SpA is expected to under-perform the Mercator Medical. But the stock apears to be less risky and, when comparing its historical volatility, UniCredit SpA is 1.24 times less risky than Mercator Medical. The stock trades about -0.14 of its potential returns per unit of risk. The Mercator Medical SA is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest 5,380 in Mercator Medical SA on September 15, 2024 and sell it today you would lose (280.00) from holding Mercator Medical SA or give up 5.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 86.36% |
| Values | Daily Returns |
UniCredit SpA vs. Mercator Medical SA
Performance |
| Timeline |
| UniCredit SpA |
| Mercator Medical |
UniCredit SpA and Mercator Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UniCredit SpA and Mercator Medical
The main advantage of trading using opposite UniCredit SpA and Mercator Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UniCredit SpA 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.| UniCredit SpA vs. SOFTWARE MANSION SPOLKA | UniCredit SpA vs. LSI Software SA | UniCredit SpA vs. Quantum Software SA | UniCredit SpA vs. Igoria Trade SA |
| Mercator Medical vs. Quantum Software SA | Mercator Medical vs. BNP Paribas Bank | Mercator Medical vs. UniCredit SpA | Mercator Medical vs. PLAYWAY 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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