Correlation Between Teradyne and F5 Networks
Can any of the company-specific risk be diversified away by investing in both Teradyne and F5 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 Teradyne and F5 Networks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teradyne and F5 Networks, you can compare the effects of market volatilities on Teradyne and F5 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 Teradyne with a short position of F5 Networks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teradyne and F5 Networks.
Diversification Opportunities for Teradyne and F5 Networks
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Teradyne and FFIV is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Teradyne and F5 Networks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on F5 Networks and Teradyne 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 Teradyne are associated (or correlated) with F5 Networks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of F5 Networks has no effect on the direction of Teradyne i.e., Teradyne and F5 Networks go up and down completely randomly.
Pair Corralation between Teradyne and F5 Networks
Considering the 90-day investment horizon Teradyne is expected to generate 2.3 times more return on investment than F5 Networks. However, Teradyne is 2.3 times more volatile than F5 Networks. It trades about 0.21 of its potential returns per unit of risk. F5 Networks is currently generating about 0.11 per unit of risk. If you would invest 7,949 in Teradyne on June 2, 2025 and sell it today you would earn a total of 3,875 from holding Teradyne or generate 48.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Teradyne vs. F5 Networks
Performance |
| Timeline |
| Teradyne |
| F5 Networks |
Teradyne and F5 Networks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Teradyne and F5 Networks
The main advantage of trading using opposite Teradyne and F5 Networks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teradyne position performs unexpectedly, F5 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 F5 Networks will offset losses from the drop in F5 Networks' long position.| Teradyne vs. IPG Photonics | Teradyne vs. Ultra Clean Holdings | Teradyne vs. Onto Innovation | Teradyne vs. Cohu Inc |
| F5 Networks vs. Akamai Technologies | F5 Networks vs. Check Point Software | F5 Networks vs. VeriSign | F5 Networks vs. Qualys Inc |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |