Correlation Between Microsoft and Beijing Scitop
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By analyzing existing cross correlation between Microsoft and Beijing Scitop Bio, you can compare the effects of market volatilities on Microsoft and Beijing Scitop 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 Beijing Scitop. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Beijing Scitop.
Diversification Opportunities for Microsoft and Beijing Scitop
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Microsoft and Beijing is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Beijing Scitop Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Scitop Bio 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 Beijing Scitop. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Scitop Bio has no effect on the direction of Microsoft i.e., Microsoft and Beijing Scitop go up and down completely randomly.
Pair Corralation between Microsoft and Beijing Scitop
Given the investment horizon of 90 days Microsoft is expected to generate 1.1 times less return on investment than Beijing Scitop. But when comparing it to its historical volatility, Microsoft is 2.15 times less risky than Beijing Scitop. It trades about 0.03 of its potential returns per unit of risk. Beijing Scitop Bio is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,633 in Beijing Scitop Bio on September 1, 2024 and sell it today you would earn a total of 14.00 from holding Beijing Scitop Bio or generate 0.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.81% |
| Values | Daily Returns |
Microsoft vs. Beijing Scitop Bio
Performance |
| Timeline |
| Microsoft |
| Beijing Scitop Bio |
Microsoft and Beijing Scitop Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Beijing Scitop
The main advantage of trading using opposite Microsoft and Beijing Scitop positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Beijing Scitop 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 Beijing Scitop will offset losses from the drop in Beijing Scitop's long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. Block Inc | Microsoft vs. Adobe Systems Incorporated |
| Beijing Scitop vs. China Life Insurance | Beijing Scitop vs. Zhengzhou Coal Mining | Beijing Scitop vs. Lootom Telcovideo Network | Beijing Scitop vs. Huaibei Mining Holdings |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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