Correlation Between Merit Medical and RDE,

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

By analyzing existing cross correlation between Merit Medical Systems and RDE, Inc, you can compare the effects of market volatilities on Merit Medical and RDE, 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 Merit Medical with a short position of RDE,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merit Medical and RDE,.

Diversification Opportunities for Merit Medical and RDE,

0.07

Correlation Coefficient

Merit Medical  RDE,

Significant diversification

The 3 months correlation between Merit and RDE, is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Merit Medical Systems and RDE, Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RDE, Inc and Merit 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 Merit Medical Systems are associated (or correlated) with RDE,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RDE, Inc has no effect on the direction of Merit Medical i.e., Merit Medical and RDE, go up and down completely randomly.

Pair Corralation between Merit Medical and RDE,

Given the investment horizon of 90 days Merit Medical Systems is expected to under-perform the RDE,. But the stock apears to be less risky and, when comparing its historical volatility, Merit Medical Systems is 4.89 times less risky than RDE,. The stock trades about -0.02 of its potential returns per unit of risk. The RDE, Inc is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  158.00  in RDE, Inc on December 2, 2024 and sell it today you would earn a total of  13.00  from holding RDE, Inc or generate 8.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Merit Medical Systems  vs.  RDE, Inc

Merit Medical Systems

Risk-Adjusted Performance

Very Weak

Over the last 90 days Merit Medical Systems has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Merit Medical is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

RDE, Inc

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in RDE, Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating technical and fundamental indicators, RDE, unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Merit Medical and RDE,

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

The idea behind Merit Medical Systems and RDE, Inc 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.