Correlation Between Microsoft and Immutep
Can any of the company-specific risk be diversified away by investing in both Microsoft and Immutep 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 Immutep into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Immutep, you can compare the effects of market volatilities on Microsoft and Immutep 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 Immutep. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Immutep.
Diversification Opportunities for Microsoft and Immutep
Excellent diversification
The 3 months correlation between Microsoft and Immutep is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Immutep in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immutep 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 Immutep. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immutep has no effect on the direction of Microsoft i.e., Microsoft and Immutep go up and down completely randomly.
Pair Corralation between Microsoft and Immutep
Assuming the 90 days trading horizon Microsoft is expected to generate 2.59 times less return on investment than Immutep. But when comparing it to its historical volatility, Microsoft is 4.07 times less risky than Immutep. It trades about 0.05 of its potential returns per unit of risk. Immutep is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 17.00 in Immutep on August 27, 2024 and sell it today you would earn a total of 2.00 from holding Immutep or generate 11.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microsoft vs. Immutep
Performance |
| Timeline |
| Microsoft |
| Immutep |
Microsoft and Immutep Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Immutep
The main advantage of trading using opposite Microsoft and Immutep positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Immutep 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 Immutep will offset losses from the drop in Immutep's long position.| Microsoft vs. AGF Management Limited | Microsoft vs. CHINA EDUCATION GROUP | Microsoft vs. DeVry Education Group | Microsoft vs. Brockhaus Capital Management |
| Immutep vs. Ribbon Communications | Immutep vs. ANTA SPORTS PRODUCT | Immutep vs. Consolidated Communications Holdings | Immutep vs. Iridium Communications |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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