Correlation Between Microsoft and PERSOL HOLDINGS
Can any of the company-specific risk be diversified away by investing in both Microsoft and PERSOL HOLDINGS 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 Microsoft and PERSOL HOLDINGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and PERSOL HOLDINGS LTD, you can compare the effects of market volatilities on Microsoft and PERSOL HOLDINGS 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 Microsoft with a short position of PERSOL HOLDINGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and PERSOL HOLDINGS.
Diversification Opportunities for Microsoft and PERSOL HOLDINGS
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Microsoft and PERSOL is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and PERSOL HOLDINGS LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PERSOL HOLDINGS LTD and Microsoft 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 Microsoft are associated (or correlated) with PERSOL HOLDINGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PERSOL HOLDINGS LTD has no effect on the direction of Microsoft i.e., Microsoft and PERSOL HOLDINGS go up and down completely randomly.
Pair Corralation between Microsoft and PERSOL HOLDINGS
Assuming the 90 days trading horizon Microsoft is expected to generate 1.14 times more return on investment than PERSOL HOLDINGS. However, Microsoft is 1.14 times more volatile than PERSOL HOLDINGS LTD. It trades about 0.04 of its potential returns per unit of risk. PERSOL HOLDINGS LTD is currently generating about -0.16 per unit of risk. If you would invest 39,852 in Microsoft on August 30, 2024 and sell it today you would earn a total of 578.00 from holding Microsoft or generate 1.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microsoft vs. PERSOL HOLDINGS LTD
Performance |
| Timeline |
| Microsoft |
| PERSOL HOLDINGS LTD |
Microsoft and PERSOL HOLDINGS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and PERSOL HOLDINGS
The main advantage of trading using opposite Microsoft and PERSOL HOLDINGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, PERSOL HOLDINGS 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 PERSOL HOLDINGS will offset losses from the drop in PERSOL HOLDINGS's long position.| Microsoft vs. Beyond Meat | Microsoft vs. Unity Software | Microsoft vs. MAGIC SOFTWARE ENTR | Microsoft vs. AUSTEVOLL SEAFOOD |
| PERSOL HOLDINGS vs. Recruit Holdings Co | PERSOL HOLDINGS vs. Randstad NV | PERSOL HOLDINGS vs. TRINET GROUP INC | PERSOL HOLDINGS vs. TONGDAO LIEPGR DL 0001 |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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