Correlation Between Juniper Networks and Mynaric AG

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

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

Diversification Opportunities for Juniper Networks and Mynaric AG

0.11

Correlation Coefficient

Juniper Networks  Mynaric AG

Average diversification

The 3 months correlation between Juniper and Mynaric is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Juniper Networks and Mynaric AG ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mynaric AG ADR 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 Mynaric AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mynaric AG ADR has no effect on the direction of Juniper Networks i.e., Juniper Networks and Mynaric AG go up and down completely randomly.

Pair Corralation between Juniper Networks and Mynaric AG

Given the investment horizon of 90 days Juniper Networks is expected to under-perform the Mynaric AG. But the stock apears to be less risky and, when comparing its historical volatility, Juniper Networks is 14.24 times less risky than Mynaric AG. The stock trades about -0.02 of its potential returns per unit of risk. The Mynaric AG ADR is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  153.00  in Mynaric AG ADR on October 8, 2024 and sell it today you would lose (61.00) from holding Mynaric AG ADR or give up 39.87% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Juniper Networks  vs.  Mynaric AG ADR

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 relatively invariable basic indicators, Juniper Networks is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Mynaric AG ADR

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Mynaric AG ADR are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting basic indicators, Mynaric AG sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Juniper Networks and Mynaric AG

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

The idea behind Juniper Networks and Mynaric AG ADR 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.