Correlation Between VerifyMe and Juniper Networks

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

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

Diversification Opportunities for VerifyMe and Juniper Networks

0.9

Correlation Coefficient

VerifyMe  Juniper Networks

Almost no diversification

The 3 months correlation between VerifyMe and Juniper is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding VerifyMe and Juniper Networks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Juniper Networks and VerifyMe 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 VerifyMe 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 VerifyMe i.e., VerifyMe and Juniper Networks go up and down completely randomly.

Pair Corralation between VerifyMe and Juniper Networks

Given the investment horizon of 90 days VerifyMe is expected to under-perform the Juniper Networks. In addition to that, VerifyMe is 6.95 times more volatile than Juniper Networks. It trades about -0.13 of its total potential returns per unit of risk. Juniper Networks is currently generating about -0.14 per unit of volatility. If you would invest  3,876  in Juniper Networks on September 2, 2024 and sell it today you would lose (284.00) from holding Juniper Networks or give up 7.33% of portfolio value over 90 days.

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

VerifyMe  vs.  Juniper Networks

VerifyMe

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VerifyMe has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's primary indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

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.

Pair Trading with VerifyMe and Juniper Networks

The main advantage of trading using opposite VerifyMe and Juniper Networks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VerifyMe 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.

The idea behind VerifyMe and Juniper Networks 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 Commodity Directory module to find actively traded commodities issued by global exchanges.