Correlation Between Juniper Networks and Aviat Networks
Can any of the company-specific risk be diversified away by investing in both Juniper Networks and Aviat 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 Juniper Networks and Aviat Networks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Juniper Networks and Aviat Networks, you can compare the effects of market volatilities on Juniper Networks and Aviat 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 Juniper Networks with a short position of Aviat Networks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Juniper Networks and Aviat Networks.
Diversification Opportunities for Juniper Networks and Aviat Networks
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Juniper and Aviat is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Juniper Networks and Aviat Networks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aviat Networks and Juniper 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 Juniper Networks are associated (or correlated) with Aviat Networks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aviat Networks has no effect on the direction of Juniper Networks i.e., Juniper Networks and Aviat Networks go up and down completely randomly.
Pair Corralation between Juniper Networks and Aviat Networks
Given the investment horizon of 90 days Juniper Networks is expected to generate 0.17 times more return on investment than Aviat Networks. However, Juniper Networks is 6.03 times less risky than Aviat Networks. It trades about -0.29 of its potential returns per unit of risk. Aviat Networks is currently generating about -0.13 per unit of risk. If you would invest 3,902 in Juniper Networks on August 27, 2024 and sell it today you would lose (311.00) from holding Juniper Networks or give up 7.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Juniper Networks vs. Aviat Networks
Performance |
| Timeline |
| Juniper Networks |
| Aviat Networks |
Juniper Networks and Aviat Networks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Juniper Networks and Aviat Networks
The main advantage of trading using opposite Juniper Networks and Aviat Networks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Juniper Networks position performs unexpectedly, Aviat 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 Aviat Networks will offset losses from the drop in Aviat Networks' long position.| Juniper Networks vs. Ichor Holdings | Juniper Networks vs. Fabrinet | Juniper Networks vs. Hello Group | Juniper Networks vs. Ultra Clean Holdings |
| Aviat Networks vs. AudioCodes | Aviat Networks vs. Silicom | Aviat Networks vs. Akoustis Technologies | Aviat Networks vs. Gilat Satellite Networks |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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