Correlation Between Ceragon Networks and William Blair

Can any of the company-specific risk be diversified away by investing in both Ceragon Networks and William Blair 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 Ceragon Networks and William Blair into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ceragon Networks and William Blair Small, you can compare the effects of market volatilities on Ceragon Networks and William Blair 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 Ceragon Networks with a short position of William Blair. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ceragon Networks and William Blair.

Diversification Opportunities for Ceragon Networks and William Blair

0.86

Correlation Coefficient

Ceragon Networks  William Blair

Very poor diversification

The 3 months correlation between Ceragon and William is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Ceragon Networks and William Blair Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on William Blair Small and Ceragon 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 Ceragon Networks are associated (or correlated) with William Blair. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of William Blair Small has no effect on the direction of Ceragon Networks i.e., Ceragon Networks and William Blair go up and down completely randomly.

Pair Corralation between Ceragon Networks and William Blair

Given the investment horizon of 90 days Ceragon Networks is expected to under-perform the William Blair. In addition to that, Ceragon Networks is 3.88 times more volatile than William Blair Small. It trades about -0.18 of its total potential returns per unit of risk. William Blair Small is currently generating about -0.13 per unit of volatility. If you would invest  2,891  in William Blair Small on December 29, 2024 and sell it today you would lose (305.00) from holding William Blair Small or give up 10.55% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.39%
Values	Daily Returns

Ceragon Networks  vs.  William Blair Small

Ceragon Networks

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ceragon Networks has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

William Blair Small

Risk-Adjusted Performance

Very Weak

Over the last 90 days William Blair Small has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Ceragon Networks and William Blair

The main advantage of trading using opposite Ceragon Networks and William Blair positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ceragon Networks position performs unexpectedly, William Blair 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 William Blair will offset losses from the drop in William Blair's long position.

The idea behind Ceragon Networks and William Blair Small pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.