Correlation Between River and Juniper Networks
Can any of the company-specific risk be diversified away by investing in both River 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 River and Juniper Networks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between River and Mercantile and Juniper Networks, you can compare the effects of market volatilities on River 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 River with a short position of Juniper Networks. Check out your portfolio center. Please also check ongoing floating volatility patterns of River and Juniper Networks.
Diversification Opportunities for River and Juniper Networks
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between River and Juniper is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding River and Mercantile and Juniper Networks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Juniper Networks and River 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 River and Mercantile 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 River i.e., River and Juniper Networks go up and down completely randomly.
Pair Corralation between River and Juniper Networks
Assuming the 90 days trading horizon River is expected to generate 2.29 times less return on investment than Juniper Networks. But when comparing it to its historical volatility, River and Mercantile is 1.4 times less risky than Juniper Networks. It trades about 0.02 of its potential returns per unit of risk. Juniper Networks is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 3,039 in Juniper Networks on September 19, 2024 and sell it today you would earn a total of 685.00 from holding Juniper Networks or generate 22.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.28% |
| Values | Daily Returns |
River and Mercantile vs. Juniper Networks
Performance |
| Timeline |
| River and Mercantile |
| Juniper Networks |
River and Juniper Networks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with River and Juniper Networks
The main advantage of trading using opposite River and Juniper Networks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if River 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.| River vs. Catalyst Media Group | River vs. CATLIN GROUP | River vs. Tamburi Investment Partners | River vs. Magnora ASA |
| 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |