Correlation Between Viavi Solutions and Maris Tech

Can any of the company-specific risk be diversified away by investing in both Viavi Solutions and Maris Tech 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 Viavi Solutions and Maris Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Viavi Solutions and Maris Tech, you can compare the effects of market volatilities on Viavi Solutions and Maris Tech 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 Viavi Solutions with a short position of Maris Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viavi Solutions and Maris Tech.

Diversification Opportunities for Viavi Solutions and Maris Tech

-0.48

Correlation Coefficient

Viavi Solutions  Maris Tech

Very good diversification

The 3 months correlation between Viavi and Maris is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Viavi Solutions and Maris Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maris Tech and Viavi Solutions 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 Viavi Solutions are associated (or correlated) with Maris Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maris Tech has no effect on the direction of Viavi Solutions i.e., Viavi Solutions and Maris Tech go up and down completely randomly.

Pair Corralation between Viavi Solutions and Maris Tech

Given the investment horizon of 90 days Viavi Solutions is expected to generate 0.44 times more return on investment than Maris Tech. However, Viavi Solutions is 2.25 times less risky than Maris Tech. It trades about 0.07 of its potential returns per unit of risk. Maris Tech is currently generating about -0.11 per unit of risk. If you would invest  1,018  in Viavi Solutions on December 27, 2024 and sell it today you would earn a total of  121.00  from holding Viavi Solutions or generate 11.89% return on investment over 90 days.

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

Viavi Solutions  vs.  Maris Tech

Viavi Solutions

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Viavi Solutions are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Viavi Solutions showed solid returns over the last few months and may actually be approaching a breakup point.

Maris Tech

Risk-Adjusted Performance

Very Weak

Over the last 90 days Maris Tech has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Viavi Solutions and Maris Tech

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

The idea behind Viavi Solutions and Maris Tech 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.