Correlation Between Ceragon Networks and JDS UNIPHASE
Can any of the company-specific risk be diversified away by investing in both Ceragon Networks and JDS UNIPHASE 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 Ceragon Networks and JDS UNIPHASE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ceragon Networks and JDS UNIPHASE, you can compare the effects of market volatilities on Ceragon Networks and JDS UNIPHASE 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 Ceragon Networks with a short position of JDS UNIPHASE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ceragon Networks and JDS UNIPHASE.
Diversification Opportunities for Ceragon Networks and JDS UNIPHASE
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ceragon and JDS is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Ceragon Networks and JDS UNIPHASE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JDS UNIPHASE and Ceragon 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 Ceragon Networks are associated (or correlated) with JDS UNIPHASE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JDS UNIPHASE has no effect on the direction of Ceragon Networks i.e., Ceragon Networks and JDS UNIPHASE go up and down completely randomly.
Pair Corralation between Ceragon Networks and JDS UNIPHASE
Given the investment horizon of 90 days Ceragon Networks is expected to generate 2.49 times more return on investment than JDS UNIPHASE. However, Ceragon Networks is 2.49 times more volatile than JDS UNIPHASE. It trades about 0.6 of its potential returns per unit of risk. JDS UNIPHASE is currently generating about 0.08 per unit of risk. If you would invest 242.00 in Ceragon Networks on September 3, 2024 and sell it today you would earn a total of 212.00 from holding Ceragon Networks or generate 87.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Ceragon Networks vs. JDS UNIPHASE
Performance |
| Timeline |
| Ceragon Networks |
| JDS UNIPHASE |
Ceragon Networks and JDS UNIPHASE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ceragon Networks and JDS UNIPHASE
The main advantage of trading using opposite Ceragon Networks and JDS UNIPHASE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ceragon Networks position performs unexpectedly, JDS UNIPHASE 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 JDS UNIPHASE will offset losses from the drop in JDS UNIPHASE's long position.| Ceragon Networks vs. Cambium Networks Corp | Ceragon Networks vs. KVH Industries | Ceragon Networks vs. Knowles Cor | Ceragon Networks vs. AudioCodes |
| JDS UNIPHASE vs. Martin Marietta Materials | JDS UNIPHASE vs. Computer And Technologies | JDS UNIPHASE vs. Japan Tobacco | JDS UNIPHASE vs. Plastic Omnium |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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