Correlation Between KENEDIX OFFICE and Microsoft
Can any of the company-specific risk be diversified away by investing in both KENEDIX OFFICE and Microsoft 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 KENEDIX OFFICE and Microsoft into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KENEDIX OFFICE INV and Microsoft, you can compare the effects of market volatilities on KENEDIX OFFICE and Microsoft 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 KENEDIX OFFICE with a short position of Microsoft. Check out your portfolio center. Please also check ongoing floating volatility patterns of KENEDIX OFFICE and Microsoft.
Diversification Opportunities for KENEDIX OFFICE and Microsoft
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between KENEDIX and Microsoft is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding KENEDIX OFFICE INV and Microsoft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microsoft and KENEDIX OFFICE 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 KENEDIX OFFICE INV are associated (or correlated) with Microsoft. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microsoft has no effect on the direction of KENEDIX OFFICE i.e., KENEDIX OFFICE and Microsoft go up and down completely randomly.
Pair Corralation between KENEDIX OFFICE and Microsoft
Assuming the 90 days horizon KENEDIX OFFICE INV is expected to under-perform the Microsoft. In addition to that, KENEDIX OFFICE is 1.34 times more volatile than Microsoft. It trades about -0.05 of its total potential returns per unit of risk. Microsoft is currently generating about 0.16 per unit of volatility. If you would invest 39,660 in Microsoft on October 25, 2024 and sell it today you would earn a total of 2,685 from holding Microsoft or generate 6.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KENEDIX OFFICE INV vs. Microsoft
Performance |
| Timeline |
| KENEDIX OFFICE INV |
| Microsoft |
KENEDIX OFFICE and Microsoft Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KENEDIX OFFICE and Microsoft
The main advantage of trading using opposite KENEDIX OFFICE and Microsoft positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KENEDIX OFFICE position performs unexpectedly, Microsoft 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 Microsoft will offset losses from the drop in Microsoft's long position.| KENEDIX OFFICE vs. 24SEVENOFFICE GROUP AB | KENEDIX OFFICE vs. OFFICE DEPOT | KENEDIX OFFICE vs. AGRICULTBK HADR25 YC | KENEDIX OFFICE vs. Sumitomo Mitsui Construction |
| Microsoft vs. CAL MAINE FOODS | Microsoft vs. SIEM OFFSHORE NEW | Microsoft vs. PREMIER FOODS | Microsoft vs. PLANT VEDA FOODS |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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