Correlation Between Juniper Networks and Belden
Can any of the company-specific risk be diversified away by investing in both Juniper Networks and Belden 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 Belden into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Juniper Networks and Belden Inc, you can compare the effects of market volatilities on Juniper Networks and Belden 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 Belden. Check out your portfolio center. Please also check ongoing floating volatility patterns of Juniper Networks and Belden.
Diversification Opportunities for Juniper Networks and Belden
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Juniper and Belden is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Juniper Networks and Belden Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Belden Inc 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 Belden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Belden Inc has no effect on the direction of Juniper Networks i.e., Juniper Networks and Belden go up and down completely randomly.
Pair Corralation between Juniper Networks and Belden
Given the investment horizon of 90 days Juniper Networks is expected to generate 2.14 times less return on investment than Belden. But when comparing it to its historical volatility, Juniper Networks is 1.57 times less risky than Belden. It trades about 0.04 of its potential returns per unit of risk. Belden Inc is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 8,273 in Belden Inc on August 27, 2024 and sell it today you would earn a total of 4,079 from holding Belden Inc or generate 49.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Juniper Networks vs. Belden Inc
Performance |
| Timeline |
| Juniper Networks |
| Belden Inc |
Juniper Networks and Belden Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Juniper Networks and Belden
The main advantage of trading using opposite Juniper Networks and Belden positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Juniper Networks position performs unexpectedly, Belden 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 Belden will offset losses from the drop in Belden's long position.| Juniper Networks vs. Ichor Holdings | Juniper Networks vs. Fabrinet | Juniper Networks vs. Hello Group | Juniper Networks vs. Ultra Clean Holdings |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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