Correlation Between Microsoft and CTBC Enhanced
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By analyzing existing cross correlation between Microsoft and CTBC Enhanced Yield, you can compare the effects of market volatilities on Microsoft and CTBC Enhanced 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 CTBC Enhanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and CTBC Enhanced.
Diversification Opportunities for Microsoft and CTBC Enhanced
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Microsoft and CTBC is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and CTBC Enhanced Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CTBC Enhanced Yield 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 CTBC Enhanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CTBC Enhanced Yield has no effect on the direction of Microsoft i.e., Microsoft and CTBC Enhanced go up and down completely randomly.
Pair Corralation between Microsoft and CTBC Enhanced
Given the investment horizon of 90 days Microsoft is expected to generate 2.47 times more return on investment than CTBC Enhanced. However, Microsoft is 2.47 times more volatile than CTBC Enhanced Yield. It trades about 0.05 of its potential returns per unit of risk. CTBC Enhanced Yield is currently generating about 0.1 per unit of risk. If you would invest 37,191 in Microsoft on September 3, 2024 and sell it today you would earn a total of 5,155 from holding Microsoft or generate 13.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 52.63% |
| Values | Daily Returns |
Microsoft vs. CTBC Enhanced Yield
Performance |
| Timeline |
| Microsoft |
| CTBC Enhanced Yield |
Microsoft and CTBC Enhanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and CTBC Enhanced
The main advantage of trading using opposite Microsoft and CTBC Enhanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, CTBC Enhanced 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 CTBC Enhanced will offset losses from the drop in CTBC Enhanced's long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. Block Inc | Microsoft vs. Adobe Systems Incorporated |
| CTBC Enhanced vs. CTBC USD Corporate | CTBC Enhanced vs. CTBC 20 Year | CTBC Enhanced vs. CTBC TIP Customized | CTBC Enhanced vs. CTBC Treasury 20 |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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