Correlation Between Aviat Networks and Cambium Networks
Can any of the company-specific risk be diversified away by investing in both Aviat Networks and Cambium 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 Aviat Networks and Cambium Networks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aviat Networks and Cambium Networks Corp, you can compare the effects of market volatilities on Aviat Networks and Cambium 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 Aviat Networks with a short position of Cambium Networks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aviat Networks and Cambium Networks.
Diversification Opportunities for Aviat Networks and Cambium Networks
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Aviat and Cambium is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Aviat Networks and Cambium Networks Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambium Networks Corp and Aviat 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 Aviat Networks are associated (or correlated) with Cambium Networks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambium Networks Corp has no effect on the direction of Aviat Networks i.e., Aviat Networks and Cambium Networks go up and down completely randomly.
Pair Corralation between Aviat Networks and Cambium Networks
Given the investment horizon of 90 days Aviat Networks is expected to generate 2.9 times less return on investment than Cambium Networks. But when comparing it to its historical volatility, Aviat Networks is 3.85 times less risky than Cambium Networks. It trades about 0.31 of its potential returns per unit of risk. Cambium Networks Corp is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 74.00 in Cambium Networks Corp on October 20, 2024 and sell it today you would earn a total of 29.00 from holding Cambium Networks Corp or generate 39.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aviat Networks vs. Cambium Networks Corp
Performance |
| Timeline |
| Aviat Networks |
| Cambium Networks Corp |
Aviat Networks and Cambium Networks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aviat Networks and Cambium Networks
The main advantage of trading using opposite Aviat Networks and Cambium Networks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aviat Networks position performs unexpectedly, Cambium 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 Cambium Networks will offset losses from the drop in Cambium Networks' long position.| Aviat Networks vs. AudioCodes | Aviat Networks vs. Silicom | Aviat Networks vs. Gilat Satellite Networks | Aviat Networks vs. Mynaric AG ADR |
| Cambium Networks vs. Aviat Networks | Cambium Networks vs. Rimini Street | Cambium Networks vs. Airgain | Cambium Networks vs. Calix Inc |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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