Correlation Between Adiuvo Investment and Mercator Medical

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

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

Diversification Opportunities for Adiuvo Investment and Mercator Medical

-0.67

Correlation Coefficient

Adiuvo Investment  Mercator Medical

Excellent diversification

The 3 months correlation between Adiuvo and Mercator is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Adiuvo Investment SA and Mercator Medical SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mercator Medical and Adiuvo Investment 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 Adiuvo Investment SA are associated (or correlated) with Mercator Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mercator Medical has no effect on the direction of Adiuvo Investment i.e., Adiuvo Investment and Mercator Medical go up and down completely randomly.

Pair Corralation between Adiuvo Investment and Mercator Medical

Assuming the 90 days trading horizon Adiuvo Investment SA is expected to under-perform the Mercator Medical. In addition to that, Adiuvo Investment is 2.4 times more volatile than Mercator Medical SA. It trades about -0.11 of its total potential returns per unit of risk. Mercator Medical SA is currently generating about 0.07 per unit of volatility. If you would invest  4,340  in Mercator Medical SA on April 24, 2025 and sell it today you would earn a total of  245.00  from holding Mercator Medical SA or generate 5.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

Adiuvo Investment SA  vs.  Mercator Medical SA

Adiuvo Investment

Risk-Adjusted Performance

Very Weak

Over the last 90 days Adiuvo Investment SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in August 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Mercator Medical

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Mercator Medical SA are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Mercator Medical is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Adiuvo Investment and Mercator Medical

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

The idea behind Adiuvo Investment SA and Mercator Medical SA 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.