Correlation Between Juniper Networks and Monster Beverage
Can any of the company-specific risk be diversified away by investing in both Juniper Networks and Monster Beverage 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 Juniper Networks and Monster Beverage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Juniper Networks and Monster Beverage Corp, you can compare the effects of market volatilities on Juniper Networks and Monster Beverage 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 Juniper Networks with a short position of Monster Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Juniper Networks and Monster Beverage.
Diversification Opportunities for Juniper Networks and Monster Beverage
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Juniper and Monster is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Juniper Networks and Monster Beverage Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Monster Beverage Corp and Juniper Networks 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 Juniper Networks are associated (or correlated) with Monster Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Monster Beverage Corp has no effect on the direction of Juniper Networks i.e., Juniper Networks and Monster Beverage go up and down completely randomly.
Pair Corralation between Juniper Networks and Monster Beverage
Assuming the 90 days trading horizon Juniper Networks is expected to generate 0.56 times more return on investment than Monster Beverage. However, Juniper Networks is 1.78 times less risky than Monster Beverage. It trades about 0.0 of its potential returns per unit of risk. Monster Beverage Corp is currently generating about -0.04 per unit of risk. If you would invest 3,671 in Juniper Networks on November 1, 2024 and sell it today you would earn a total of 0.00 from holding Juniper Networks or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.54% |
| Values | Daily Returns |
Juniper Networks vs. Monster Beverage Corp
Performance |
| Timeline |
| Juniper Networks |
| Monster Beverage Corp |
Juniper Networks and Monster Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Juniper Networks and Monster Beverage
The main advantage of trading using opposite Juniper Networks and Monster Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Juniper Networks position performs unexpectedly, Monster Beverage 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 Monster Beverage will offset losses from the drop in Monster Beverage's long position.| Juniper Networks vs. Monster Beverage Corp | Juniper Networks vs. Check Point Software | Juniper Networks vs. AMG Advanced Metallurgical | Juniper Networks vs. Empire Metals Limited |
| Monster Beverage vs. Datagroup SE | Monster Beverage vs. Public Storage | Monster Beverage vs. Sligro Food Group | Monster Beverage vs. Hilton Food Group |
Check out your portfolio center.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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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