Correlation Between Merit Medical and AptarGroup
Can any of the company-specific risk be diversified away by investing in both Merit Medical and AptarGroup 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 AptarGroup 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 AptarGroup, you can compare the effects of market volatilities on Merit Medical and AptarGroup 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 AptarGroup. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merit Medical and AptarGroup.
Diversification Opportunities for Merit Medical and AptarGroup
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Merit and AptarGroup is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Merit Medical Systems and AptarGroup in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AptarGroup 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 AptarGroup. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AptarGroup has no effect on the direction of Merit Medical i.e., Merit Medical and AptarGroup go up and down completely randomly.
Pair Corralation between Merit Medical and AptarGroup
Given the investment horizon of 90 days Merit Medical Systems is expected to under-perform the AptarGroup. In addition to that, Merit Medical is 1.25 times more volatile than AptarGroup. It trades about -0.07 of its total potential returns per unit of risk. AptarGroup is currently generating about 0.07 per unit of volatility. If you would invest 14,822 in AptarGroup on April 3, 2025 and sell it today you would earn a total of 1,079 from holding AptarGroup or generate 7.28% 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. AptarGroup
Performance |
| Timeline |
| Merit Medical Systems |
| AptarGroup |
Merit Medical and AptarGroup Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merit Medical and AptarGroup
The main advantage of trading using opposite Merit Medical and AptarGroup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merit Medical position performs unexpectedly, AptarGroup 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 AptarGroup will offset losses from the drop in AptarGroup's long position.| Merit Medical vs. Uber Technologies | Merit Medical vs. FS KKR Capital | Merit Medical vs. Virtus Investment Partners, | Merit Medical vs. Fidus Investment Corp |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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