Correlation Between Microsoft Corp and Atrium Mortgage
Can any of the company-specific risk be diversified away by investing in both Microsoft Corp and Atrium Mortgage 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 Corp and Atrium Mortgage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft Corp CDR and Atrium Mortgage Investment, you can compare the effects of market volatilities on Microsoft Corp and Atrium Mortgage 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 Corp with a short position of Atrium Mortgage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft Corp and Atrium Mortgage.
Diversification Opportunities for Microsoft Corp and Atrium Mortgage
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Microsoft and Atrium is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft Corp CDR and Atrium Mortgage Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atrium Mortgage Inve and Microsoft Corp 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 Corp CDR are associated (or correlated) with Atrium Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atrium Mortgage Inve has no effect on the direction of Microsoft Corp i.e., Microsoft Corp and Atrium Mortgage go up and down completely randomly.
Pair Corralation between Microsoft Corp and Atrium Mortgage
Assuming the 90 days trading horizon Microsoft Corp CDR is expected to under-perform the Atrium Mortgage. In addition to that, Microsoft Corp is 2.6 times more volatile than Atrium Mortgage Investment. It trades about -0.01 of its total potential returns per unit of risk. Atrium Mortgage Investment is currently generating about 0.09 per unit of volatility. If you would invest 1,124 in Atrium Mortgage Investment on August 29, 2024 and sell it today you would earn a total of 14.00 from holding Atrium Mortgage Investment or generate 1.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microsoft Corp CDR vs. Atrium Mortgage Investment
Performance |
| Timeline |
| Microsoft Corp CDR |
| Atrium Mortgage Inve |
Microsoft Corp and Atrium Mortgage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft Corp and Atrium Mortgage
The main advantage of trading using opposite Microsoft Corp and Atrium Mortgage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft Corp position performs unexpectedly, Atrium Mortgage 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 Atrium Mortgage will offset losses from the drop in Atrium Mortgage's long position.| Microsoft Corp vs. Berkshire Hathaway CDR | Microsoft Corp vs. JPMorgan Chase Co | Microsoft Corp vs. Bank of America | Microsoft Corp vs. Alphabet Inc CDR |
| Atrium Mortgage vs. Microsoft Corp CDR | Atrium Mortgage vs. Apple Inc CDR | Atrium Mortgage vs. Alphabet Inc CDR | Atrium Mortgage vs. Amazon CDR |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |