Correlation Between Juniper Networks and PPL
Can any of the company-specific risk be diversified away by investing in both Juniper Networks and PPL 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 PPL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Juniper Networks and PPL Corporation, you can compare the effects of market volatilities on Juniper Networks and PPL 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 PPL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Juniper Networks and PPL.
Diversification Opportunities for Juniper Networks and PPL
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Juniper and PPL is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Juniper Networks and PPL Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PPL Corporation 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 PPL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PPL Corporation has no effect on the direction of Juniper Networks i.e., Juniper Networks and PPL go up and down completely randomly.
Pair Corralation between Juniper Networks and PPL
Given the investment horizon of 90 days Juniper Networks is expected to under-perform the PPL. But the stock apears to be less risky and, when comparing its historical volatility, Juniper Networks is 3.2 times less risky than PPL. The stock trades about -0.34 of its potential returns per unit of risk. The PPL Corporation is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,706 in PPL Corporation on January 24, 2024 and sell it today you would earn a total of 31.00 from holding PPL Corporation or generate 1.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Juniper Networks vs. PPL Corp.
Performance |
| Timeline |
| Juniper Networks |
| PPL Corporation |
Juniper Networks and PPL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Juniper Networks and PPL
The main advantage of trading using opposite Juniper Networks and PPL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Juniper Networks position performs unexpectedly, PPL 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 PPL will offset losses from the drop in PPL's long position.| Juniper Networks vs. Desktop Metal | Juniper Networks vs. Fabrinet | Juniper Networks vs. Kimball Electronics | Juniper Networks vs. Knowles Cor |
| PPL vs. Centrais Eltricas Brasileiras | PPL vs. Central Puerto SA | PPL vs. CMS Energy | PPL vs. Centrais Electricas Brasileiras |
Check out your portfolio center.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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |