Correlation Between Box and A10 Network
Can any of the company-specific risk be diversified away by investing in both Box and A10 Network 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 Box and A10 Network into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Box Inc and A10 Network, you can compare the effects of market volatilities on Box and A10 Network 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 Box with a short position of A10 Network. Check out your portfolio center. Please also check ongoing floating volatility patterns of Box and A10 Network.
Diversification Opportunities for Box and A10 Network
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Box and A10 is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Box Inc and A10 Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A10 Network and Box 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 Box Inc are associated (or correlated) with A10 Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A10 Network has no effect on the direction of Box i.e., Box and A10 Network go up and down completely randomly.
Pair Corralation between Box and A10 Network
Considering the 90-day investment horizon Box is expected to generate 1.43 times less return on investment than A10 Network. But when comparing it to its historical volatility, Box Inc is 1.21 times less risky than A10 Network. It trades about 0.08 of its potential returns per unit of risk. A10 Network is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,329 in A10 Network on November 9, 2024 and sell it today you would earn a total of 726.00 from holding A10 Network or generate 54.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Box Inc vs. A10 Network
Performance |
| Timeline |
| Box Inc |
| A10 Network |
Box and A10 Network Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Box and A10 Network
The main advantage of trading using opposite Box and A10 Network positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Box position performs unexpectedly, A10 Network 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 A10 Network will offset losses from the drop in A10 Network's long position.The idea behind Box Inc and A10 Network 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.| A10 Network vs. Evertec | A10 Network vs. NetScout Systems | A10 Network vs. AvidXchange Holdings | A10 Network vs. CSG Systems International |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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