Correlation Between Dow Jones and Juniper Networks
Can any of the company-specific risk be diversified away by investing in both Dow Jones 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 Dow Jones and Juniper Networks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dow Jones Industrial and Juniper Networks, you can compare the effects of market volatilities on Dow Jones 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 Dow Jones with a short position of Juniper Networks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Juniper Networks.
Diversification Opportunities for Dow Jones and Juniper Networks
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dow and Juniper is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Juniper Networks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Juniper Networks and Dow Jones 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 Dow Jones Industrial 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 Dow Jones i.e., Dow Jones and Juniper Networks go up and down completely randomly.
Pair Corralation between Dow Jones and Juniper Networks
Assuming the 90 days trading horizon Dow Jones Industrial is expected to under-perform the Juniper Networks. But the index apears to be less risky and, when comparing its historical volatility, Dow Jones Industrial is 1.63 times less risky than Juniper Networks. The index trades about -0.14 of its potential returns per unit of risk. The Juniper Networks is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 3,568 in Juniper Networks on September 19, 2024 and sell it today you would earn a total of 206.00 from holding Juniper Networks or generate 5.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. Juniper Networks
Performance |
| Timeline |
Dow Jones and Juniper Networks Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Juniper Networks
Pair trading matchups for Juniper Networks
Pair Trading with Dow Jones and Juniper Networks
The main advantage of trading using opposite Dow Jones and Juniper Networks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones 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.| Dow Jones vs. Digi International | Dow Jones vs. Grupo Televisa SAB | Dow Jones vs. United Microelectronics | Dow Jones vs. Weibo Corp |
| Juniper Networks vs. Panther Metals PLC | Juniper Networks vs. Jacquet Metal Service | Juniper Networks vs. Blackrock World Mining | Juniper Networks vs. Summit Materials Cl |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |