Correlation Between Monster Beverage and Juniper Networks
Can any of the company-specific risk be diversified away by investing in both Monster Beverage and Juniper Networks 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 Monster Beverage and Juniper Networks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monster Beverage Corp and Juniper Networks, you can compare the effects of market volatilities on Monster Beverage and Juniper Networks 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 Monster Beverage with a short position of Juniper Networks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monster Beverage and Juniper Networks.
Diversification Opportunities for Monster Beverage and Juniper Networks
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Monster and Juniper is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Monster Beverage Corp and Juniper Networks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Juniper Networks and Monster Beverage 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 Monster Beverage Corp are associated (or correlated) with Juniper Networks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Juniper Networks has no effect on the direction of Monster Beverage i.e., Monster Beverage and Juniper Networks go up and down completely randomly.
Pair Corralation between Monster Beverage and Juniper Networks
Assuming the 90 days trading horizon Monster Beverage is expected to generate 85.0 times less return on investment than Juniper Networks. But when comparing it to its historical volatility, Monster Beverage Corp is 1.17 times less risky than Juniper Networks. It trades about 0.0 of its potential returns per unit of risk. Juniper Networks is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 3,061 in Juniper Networks on October 17, 2024 and sell it today you would earn a total of 794.00 from holding Juniper Networks or generate 25.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.83% |
| Values | Daily Returns |
Monster Beverage Corp vs. Juniper Networks
Performance |
| Timeline |
| Monster Beverage Corp |
| Juniper Networks |
Monster Beverage and Juniper Networks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monster Beverage and Juniper Networks
The main advantage of trading using opposite Monster Beverage and Juniper Networks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monster Beverage position performs unexpectedly, Juniper Networks 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 Juniper Networks will offset losses from the drop in Juniper Networks' long position.| Monster Beverage vs. Zoom Video Communications | Monster Beverage vs. Coeur Mining | Monster Beverage vs. Eastinco Mining Exploration | Monster Beverage vs. Thor Mining PLC |
| Juniper Networks vs. JLEN Environmental Assets | Juniper Networks vs. Scandinavian Tobacco Group | Juniper Networks vs. Vulcan Materials Co | Juniper Networks vs. Monster Beverage Corp |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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