Correlation Between Medicus Pharma and Mersana Therapeutics

Can any of the company-specific risk be diversified away by investing in both Medicus Pharma and Mersana Therapeutics 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 Medicus Pharma and Mersana Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Medicus Pharma Ltd and Mersana Therapeutics, you can compare the effects of market volatilities on Medicus Pharma and Mersana Therapeutics 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 Medicus Pharma with a short position of Mersana Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medicus Pharma and Mersana Therapeutics.

Diversification Opportunities for Medicus Pharma and Mersana Therapeutics

0.29

Correlation Coefficient

Medicus Pharma  Mersana Therapeutics

Modest diversification

The 3 months correlation between Medicus and Mersana is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Medicus Pharma Ltd and Mersana Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mersana Therapeutics and Medicus Pharma 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 Medicus Pharma Ltd are associated (or correlated) with Mersana Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mersana Therapeutics has no effect on the direction of Medicus Pharma i.e., Medicus Pharma and Mersana Therapeutics go up and down completely randomly.

Pair Corralation between Medicus Pharma and Mersana Therapeutics

Given the investment horizon of 90 days Medicus Pharma Ltd is expected to under-perform the Mersana Therapeutics. In addition to that, Medicus Pharma is 1.33 times more volatile than Mersana Therapeutics. It trades about -0.05 of its total potential returns per unit of risk. Mersana Therapeutics is currently generating about 0.0 per unit of volatility. If you would invest  811.00  in Mersana Therapeutics on May 7, 2025 and sell it today you would lose (107.00) from holding Mersana Therapeutics or give up 13.19% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Medicus Pharma Ltd  vs.  Mersana Therapeutics

Medicus Pharma

Risk-Adjusted Performance

Weakest

Over the last 90 days Medicus Pharma Ltd has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in September 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Mersana Therapeutics

Risk-Adjusted Performance

Weakest

Over the last 90 days Mersana Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Mersana Therapeutics is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Medicus Pharma and Mersana Therapeutics

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

The idea behind Medicus Pharma Ltd and Mersana Therapeutics 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.