Correlation Between JBG SMITH and Meyer Burger

Can any of the company-specific risk be diversified away by investing in both JBG SMITH and Meyer Burger 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 JBG SMITH and Meyer Burger into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between JBG SMITH Properties and Meyer Burger Technology, you can compare the effects of market volatilities on JBG SMITH and Meyer Burger 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 JBG SMITH with a short position of Meyer Burger. Check out your portfolio center. Please also check ongoing floating volatility patterns of JBG SMITH and Meyer Burger.

Diversification Opportunities for JBG SMITH and Meyer Burger

0.36

Correlation Coefficient

JBG SMITH  Meyer Burger

Weak diversification

The 3 months correlation between JBG and Meyer is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding JBG SMITH Properties and Meyer Burger Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meyer Burger Technology and JBG SMITH 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 JBG SMITH Properties are associated (or correlated) with Meyer Burger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meyer Burger Technology has no effect on the direction of JBG SMITH i.e., JBG SMITH and Meyer Burger go up and down completely randomly.

Pair Corralation between JBG SMITH and Meyer Burger

Given the investment horizon of 90 days JBG SMITH is expected to generate 1.11 times less return on investment than Meyer Burger. But when comparing it to its historical volatility, JBG SMITH Properties is 5.88 times less risky than Meyer Burger. It trades about 0.03 of its potential returns per unit of risk. Meyer Burger Technology is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  208.00  in Meyer Burger Technology on December 26, 2024 and sell it today you would lose (69.00) from holding Meyer Burger Technology or give up 33.17% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

JBG SMITH Properties  vs.  Meyer Burger Technology

JBG SMITH Properties

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in JBG SMITH Properties are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, JBG SMITH is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Meyer Burger Technology

Risk-Adjusted Performance

Very Weak

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

Pair Trading with JBG SMITH and Meyer Burger

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

The idea behind JBG SMITH Properties and Meyer Burger Technology 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.