Correlation Between F5 Networks and Appian

By analyzing existing cross correlation between F5 Networks and Appian, you can compare the effects of market volatilities on F5 Networks and Appian 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 F5 Networks with a short position of Appian. Check out your portfolio center. Please also check ongoing floating volatility patterns of F5 Networks and Appian.

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Can any of the company-specific risk be diversified away by investing in both F5 Networks and Appian 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 F5 Networks and Appian into the same portfolio, which is an essential part of the fundamental portfolio management process.

Diversification Opportunities for F5 Networks and Appian

0.79
  Correlation Coefficient
F5 Networks
Appian

Poor diversification

The 3 months correlation between F5 Networks and Appian is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding F5 Networks Inc and Appian Corp. in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Appian and F5 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 F5 Networks are associated (or correlated) with Appian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Appian has no effect on the direction of F5 Networks i.e. F5 Networks and Appian go up and down completely randomly.

Pair Corralation between F5 Networks and Appian

Given the investment horizon of 30 days, F5 Networks is expected to generate 1.5 times less return on investment than Appian. But when comparing it to its historical volatility, F5 Networks is 1.81 times less risky than Appian. It trades about 0.12 of its potential returns per unit of risk. Appian is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  3,997  in Appian on June 11, 2020 and sell it today you would earn a total of  943.00  from holding Appian or generate 23.59% return on investment over 30 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy98.44%
ValuesDaily Returns

F5 Networks Inc  vs.  Appian Corp.

 Performance (%) 
      Timeline 
F5 Networks 
88

F5 Networks Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in F5 Networks are ranked lower than 8 (%) of all global equities and portfolios over the last 30 days. In spite of fairly weak primary indicators, F5 Networks showed solid returns over the last few months and may actually be approaching a breakup point.
Appian 
66

Appian Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Appian are ranked lower than 6 (%) of all global equities and portfolios over the last 30 days. Although quite unsteady forward indicators, Appian disclosed solid returns over the last few months and may actually be approaching a breakup point.

F5 Networks and Appian Volatility Contrast

 Predicted Return Density 
      Returns 
Check out your portfolio center. Please also try Analyst Recommendations module to analyst recommendations and target price estimates broken down by several categories.


 
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