Correlation Between Merit Medical and Milestone Scientific
Can any of the company-specific risk be diversified away by investing in both Merit Medical and Milestone Scientific 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 Milestone Scientific 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 Milestone Scientific, you can compare the effects of market volatilities on Merit Medical and Milestone Scientific 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 Milestone Scientific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merit Medical and Milestone Scientific.
Diversification Opportunities for Merit Medical and Milestone Scientific
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Merit and Milestone is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Merit Medical Systems and Milestone Scientific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Milestone Scientific 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 Milestone Scientific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Milestone Scientific has no effect on the direction of Merit Medical i.e., Merit Medical and Milestone Scientific go up and down completely randomly.
Pair Corralation between Merit Medical and Milestone Scientific
Given the investment horizon of 90 days Merit Medical Systems is expected to generate 0.51 times more return on investment than Milestone Scientific. However, Merit Medical Systems is 1.97 times less risky than Milestone Scientific. It trades about -0.07 of its potential returns per unit of risk. Milestone Scientific is currently generating about -0.06 per unit of risk. If you would invest 10,571 in Merit Medical Systems on March 31, 2025 and sell it today you would lose (1,221) from holding Merit Medical Systems or give up 11.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Merit Medical Systems vs. Milestone Scientific
Performance |
| Timeline |
| Merit Medical Systems |
| Milestone Scientific |
Merit Medical and Milestone Scientific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merit Medical and Milestone Scientific
The main advantage of trading using opposite Merit Medical and Milestone Scientific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merit Medical position performs unexpectedly, Milestone Scientific 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 Milestone Scientific will offset losses from the drop in Milestone Scientific's long position.| Merit Medical vs. Teleflex Incorporated | Merit Medical vs. The Cooper Companies, | Merit Medical vs. West Pharmaceutical Services | Merit Medical vs. ICU Medical |
| Milestone Scientific vs. InfuSystems Holdings | Milestone Scientific vs. STRATA Skin Sciences | Milestone Scientific vs. Retractable Technologies | Milestone Scientific vs. PAVmed Inc |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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