Correlation Between Zinc Media and Juniper Networks
Can any of the company-specific risk be diversified away by investing in both Zinc Media 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 Zinc Media and Juniper Networks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zinc Media Group and Juniper Networks, you can compare the effects of market volatilities on Zinc Media 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 Zinc Media with a short position of Juniper Networks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zinc Media and Juniper Networks.
Diversification Opportunities for Zinc Media and Juniper Networks
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zinc and Juniper is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Zinc Media Group and Juniper Networks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Juniper Networks and Zinc Media 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 Zinc Media Group 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 Zinc Media i.e., Zinc Media and Juniper Networks go up and down completely randomly.
Pair Corralation between Zinc Media and Juniper Networks
Assuming the 90 days trading horizon Zinc Media Group is expected to under-perform the Juniper Networks. In addition to that, Zinc Media is 1.47 times more volatile than Juniper Networks. It trades about -0.04 of its total potential returns per unit of risk. Juniper Networks is currently generating about 0.03 per unit of volatility. If you would invest 3,046 in Juniper Networks on September 23, 2024 and sell it today you would earn a total of 698.00 from holding Juniper Networks or generate 22.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.97% |
| Values | Daily Returns |
Zinc Media Group vs. Juniper Networks
Performance |
| Timeline |
| Zinc Media Group |
| Juniper Networks |
Zinc Media and Juniper Networks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zinc Media and Juniper Networks
The main advantage of trading using opposite Zinc Media and Juniper Networks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zinc Media 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.| Zinc Media vs. SupplyMe Capital PLC | Zinc Media vs. Lloyds Banking Group | Zinc Media vs. Premier African Minerals | Zinc Media vs. SANTANDER UK 8 |
| Juniper Networks vs. Zinc Media Group | Juniper Networks vs. Kinnevik Investment AB | Juniper Networks vs. Live Nation Entertainment | Juniper Networks vs. Lowland Investment Co |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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