Correlation Between Logan Ridge and Meyer Burger

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

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

Diversification Opportunities for Logan Ridge and Meyer Burger

-0.47

Correlation Coefficient

Logan Ridge  Meyer Burger

Very good diversification

The 3 months correlation between Logan and Meyer is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Logan Ridge Finance 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 Logan Ridge 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 Logan Ridge Finance 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 Logan Ridge i.e., Logan Ridge and Meyer Burger go up and down completely randomly.

Pair Corralation between Logan Ridge and Meyer Burger

Given the investment horizon of 90 days Logan Ridge is expected to generate 1130.11 times less return on investment than Meyer Burger. But when comparing it to its historical volatility, Logan Ridge Finance is 224.2 times less risky than Meyer Burger. It trades about 0.05 of its potential returns per unit of risk. Meyer Burger Technology is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest  44,625  in Meyer Burger Technology on September 17, 2024 and sell it today you would lose (44,387) from holding Meyer Burger Technology or give up 99.47% of portfolio value over 90 days.

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

Logan Ridge Finance  vs.  Meyer Burger Technology

Logan Ridge Finance

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Logan Ridge Finance are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile technical and fundamental indicators, Logan Ridge may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Meyer Burger Technology

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Meyer Burger Technology are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating basic indicators, Meyer Burger reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Logan Ridge and Meyer Burger

The main advantage of trading using opposite Logan Ridge and Meyer Burger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Logan Ridge 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 Logan Ridge Finance 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.