Correlation Between Merit Medical and Rex Energy
Can any of the company-specific risk be diversified away by investing in both Merit Medical and Rex Energy 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 Rex Energy 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 Rex Energy, you can compare the effects of market volatilities on Merit Medical and Rex Energy 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 Rex Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merit Medical and Rex Energy.
Diversification Opportunities for Merit Medical and Rex Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Merit and Rex is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Merit Medical Systems and Rex Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rex Energy 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 Rex Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rex Energy has no effect on the direction of Merit Medical i.e., Merit Medical and Rex Energy go up and down completely randomly.
Pair Corralation between Merit Medical and Rex Energy
If you would invest (100.00) in Rex Energy on January 17, 2024 and sell it today you would earn a total of 100.00 from holding Rex Energy or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Merit Medical Systems vs. Rex Energy
Performance |
| Timeline |
| Merit Medical Systems |
| Rex Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Merit Medical and Rex Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merit Medical and Rex Energy
The main advantage of trading using opposite Merit Medical and Rex Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merit Medical position performs unexpectedly, Rex Energy 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 Rex Energy will offset losses from the drop in Rex Energy's long position.| Merit Medical vs. The Ensign Group | Merit Medical vs. Select Medical Holdings | Merit Medical vs. Encompass Health Corp | Merit Medical vs. Enhabit |
| Rex Energy vs. Marie Brizard Wine | Rex Energy vs. Fresh Grapes LLC | Rex Energy vs. Monster Beverage Corp | Rex Energy vs. Corby Spirit and |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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