Correlation Between Focus Universal and Infinera
Can any of the company-specific risk be diversified away by investing in both Focus Universal and Infinera 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 Focus Universal and Infinera into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Focus Universal and Infinera, you can compare the effects of market volatilities on Focus Universal and Infinera 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 Focus Universal with a short position of Infinera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Focus Universal and Infinera.
Diversification Opportunities for Focus Universal and Infinera
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Focus and Infinera is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Focus Universal and Infinera in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infinera and Focus Universal 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 Focus Universal are associated (or correlated) with Infinera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infinera has no effect on the direction of Focus Universal i.e., Focus Universal and Infinera go up and down completely randomly.
Pair Corralation between Focus Universal and Infinera
Given the investment horizon of 90 days Focus Universal is expected to under-perform the Infinera. In addition to that, Focus Universal is 49.73 times more volatile than Infinera. It trades about -0.02 of its total potential returns per unit of risk. Infinera is currently generating about 0.04 per unit of volatility. If you would invest 660.00 in Infinera on November 9, 2024 and sell it today you would earn a total of 2.00 from holding Infinera or generate 0.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Focus Universal vs. Infinera
Performance |
| Timeline |
| Focus Universal |
| Infinera |
Focus Universal and Infinera Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Focus Universal and Infinera
The main advantage of trading using opposite Focus Universal and Infinera positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Focus Universal position performs unexpectedly, Infinera 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 Infinera will offset losses from the drop in Infinera's long position.| Focus Universal vs. ESCO Technologies | Focus Universal vs. Genasys | Focus Universal vs. Know Labs | Focus Universal vs. Sono Tek Corp |
| Infinera vs. Juniper Networks | Infinera vs. Lumentum Holdings | Infinera vs. Extreme Networks | Infinera vs. Clearfield |
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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