Correlation Between Meyer Burger and Clear Blue

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

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

Diversification Opportunities for Meyer Burger and Clear Blue

0.41

Correlation Coefficient

Meyer Burger  Clear Blue

Very weak diversification

The 3 months correlation between Meyer and Clear is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Meyer Burger Technology and Clear Blue Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clear Blue Technologies and Meyer Burger 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 Meyer Burger Technology are associated (or correlated) with Clear Blue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clear Blue Technologies has no effect on the direction of Meyer Burger i.e., Meyer Burger and Clear Blue go up and down completely randomly.

Pair Corralation between Meyer Burger and Clear Blue

Assuming the 90 days horizon Meyer Burger Technology is expected to generate 1.96 times more return on investment than Clear Blue. However, Meyer Burger is 1.96 times more volatile than Clear Blue Technologies. It trades about 0.11 of its potential returns per unit of risk. Clear Blue Technologies is currently generating about -0.01 per unit of risk. If you would invest  195.00  in Meyer Burger Technology on September 16, 2024 and sell it today you would earn a total of  43.00  from holding Meyer Burger Technology or generate 22.05% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.48%
Values	Daily Returns

Meyer Burger Technology  vs.  Clear Blue Technologies

Meyer Burger Technology

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Meyer Burger Technology are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Meyer Burger reported solid returns over the last few months and may actually be approaching a breakup point.

Clear Blue Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Clear Blue Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Meyer Burger and Clear Blue

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

The idea behind Meyer Burger Technology and Clear Blue Technologies 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.