Correlation Between MeVis Medical and La Française

Can any of the company-specific risk be diversified away by investing in both MeVis Medical and La Française 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 MeVis Medical and La Française into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MeVis Medical Solutions and La Franaise des, you can compare the effects of market volatilities on MeVis Medical and La Française 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 MeVis Medical with a short position of La Française. Check out your portfolio center. Please also check ongoing floating volatility patterns of MeVis Medical and La Française.

Diversification Opportunities for MeVis Medical and La Française

-0.63

Correlation Coefficient

MeVis Medical  La Française

Excellent diversification

The 3 months correlation between MeVis and 1WE is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding MeVis Medical Solutions and La Franaise des in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on La Franaise des and MeVis Medical 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 MeVis Medical Solutions are associated (or correlated) with La Française. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of La Franaise des has no effect on the direction of MeVis Medical i.e., MeVis Medical and La Française go up and down completely randomly.

Pair Corralation between MeVis Medical and La Française

Assuming the 90 days trading horizon MeVis Medical Solutions is expected to generate 0.54 times more return on investment than La Française. However, MeVis Medical Solutions is 1.85 times less risky than La Française. It trades about 0.08 of its potential returns per unit of risk. La Franaise des is currently generating about -0.14 per unit of risk. If you would invest  2,420  in MeVis Medical Solutions on December 19, 2024 and sell it today you would earn a total of  120.00  from holding MeVis Medical Solutions or generate 4.96% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.33%
Values	Daily Returns

MeVis Medical Solutions  vs.  La Franaise des

MeVis Medical Solutions

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in MeVis Medical Solutions are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, MeVis Medical is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

La Franaise des

Risk-Adjusted Performance

Very Weak

Over the last 90 days La Franaise des has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with MeVis Medical and La Française

The main advantage of trading using opposite MeVis Medical and La Française positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MeVis Medical position performs unexpectedly, La Française 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 La Française will offset losses from the drop in La Française's long position.

The idea behind MeVis Medical Solutions and La Franaise des 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.

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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 Global Correlations module to find global opportunities by holding instruments from different markets.