Correlation Between Stratasys and Juniper Networks
Can any of the company-specific risk be diversified away by investing in both Stratasys 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 Stratasys and Juniper Networks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stratasys and Juniper Networks, you can compare the effects of market volatilities on Stratasys 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 Stratasys with a short position of Juniper Networks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stratasys and Juniper Networks.
Diversification Opportunities for Stratasys and Juniper Networks
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Stratasys and Juniper is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Stratasys and Juniper Networks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Juniper Networks and Stratasys 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 Stratasys 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 Stratasys i.e., Stratasys and Juniper Networks go up and down completely randomly.
Pair Corralation between Stratasys and Juniper Networks
Given the investment horizon of 90 days Stratasys is expected to generate 3.42 times more return on investment than Juniper Networks. However, Stratasys is 3.42 times more volatile than Juniper Networks. It trades about 0.23 of its potential returns per unit of risk. Juniper Networks is currently generating about -0.06 per unit of risk. If you would invest 839.00 in Stratasys on September 13, 2024 and sell it today you would earn a total of 229.00 from holding Stratasys or generate 27.29% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Stratasys vs. Juniper Networks
Performance |
Timeline |
Stratasys |
Juniper Networks |
Stratasys and Juniper Networks Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Stratasys and Juniper Networks
The main advantage of trading using opposite Stratasys and Juniper Networks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stratasys 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.Stratasys vs. Rigetti Computing | Stratasys vs. D Wave Quantum | Stratasys vs. Desktop Metal | Stratasys vs. Quantum Computing |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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