Correlation Between Juniper Networks and Moving IMage

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

By analyzing existing cross correlation between Juniper Networks and Moving iMage Technologies, you can compare the effects of market volatilities on Juniper Networks and Moving IMage 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 Moving IMage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Juniper Networks and Moving IMage.

Diversification Opportunities for Juniper Networks and Moving IMage

-0.42

Correlation Coefficient

Juniper Networks  Moving IMage

Very good diversification

The 3 months correlation between Juniper and Moving is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Juniper Networks and Moving iMage Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moving iMage Technologies 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 Moving IMage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moving iMage Technologies has no effect on the direction of Juniper Networks i.e., Juniper Networks and Moving IMage go up and down completely randomly.

Pair Corralation between Juniper Networks and Moving IMage

Given the investment horizon of 90 days Juniper Networks is expected to under-perform the Moving IMage. But the stock apears to be less risky and, when comparing its historical volatility, Juniper Networks is 4.82 times less risky than Moving IMage. The stock trades about -0.15 of its potential returns per unit of risk. The Moving iMage Technologies is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  56.00  in Moving iMage Technologies on September 4, 2024 and sell it today you would earn a total of  11.00  from holding Moving iMage Technologies or generate 19.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Juniper Networks  vs.  Moving iMage Technologies

Juniper Networks

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Juniper Networks has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unfluctuating performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Moving iMage Technologies

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Moving iMage Technologies are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively conflicting basic indicators, Moving IMage reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Juniper Networks and Moving IMage

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

The idea behind Juniper Networks and Moving iMage Technologies 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.