Correlation Between Meritage Homes and STORAGEVAULT CANADA

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

By analyzing existing cross correlation between Meritage Homes and STORAGEVAULT CANADA INC, you can compare the effects of market volatilities on Meritage Homes and STORAGEVAULT CANADA 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 Meritage Homes with a short position of STORAGEVAULT CANADA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meritage Homes and STORAGEVAULT CANADA.

Diversification Opportunities for Meritage Homes and STORAGEVAULT CANADA

-0.14

Correlation Coefficient

Meritage Homes  STORAGEVAULT CANADA

Good diversification

The 3 months correlation between Meritage and STORAGEVAULT is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Meritage Homes and STORAGEVAULT CANADA INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STORAGEVAULT CANADA INC and Meritage Homes 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 Meritage Homes are associated (or correlated) with STORAGEVAULT CANADA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STORAGEVAULT CANADA INC has no effect on the direction of Meritage Homes i.e., Meritage Homes and STORAGEVAULT CANADA go up and down completely randomly.

Pair Corralation between Meritage Homes and STORAGEVAULT CANADA

Assuming the 90 days horizon Meritage Homes is expected to generate 7.41 times less return on investment than STORAGEVAULT CANADA. In addition to that, Meritage Homes is 1.12 times more volatile than STORAGEVAULT CANADA INC. It trades about 0.01 of its total potential returns per unit of risk. STORAGEVAULT CANADA INC is currently generating about 0.09 per unit of volatility. If you would invest  230.00  in STORAGEVAULT CANADA INC on April 24, 2025 and sell it today you would earn a total of  24.00  from holding STORAGEVAULT CANADA INC or generate 10.43% return on investment over 90 days.

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

Meritage Homes  vs.  STORAGEVAULT CANADA INC

Meritage Homes

Risk-Adjusted Performance

Very Weak

Over the last 90 days Meritage Homes has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Meritage Homes is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

STORAGEVAULT CANADA INC

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in STORAGEVAULT CANADA INC are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, STORAGEVAULT CANADA may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Meritage Homes and STORAGEVAULT CANADA

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

The idea behind Meritage Homes and STORAGEVAULT CANADA 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.