Correlation Between Microsoft and Amundi Index
Can any of the company-specific risk be diversified away by investing in both Microsoft and Amundi Index 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 Amundi Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Amundi Index Solutions, you can compare the effects of market volatilities on Microsoft and Amundi Index 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 Amundi Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Amundi Index.
Diversification Opportunities for Microsoft and Amundi Index
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Microsoft and Amundi is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Amundi Index Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi Index Solutions 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 Amundi Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi Index Solutions has no effect on the direction of Microsoft i.e., Microsoft and Amundi Index go up and down completely randomly.
Pair Corralation between Microsoft and Amundi Index
Given the investment horizon of 90 days Microsoft is expected to generate 3.55 times less return on investment than Amundi Index. In addition to that, Microsoft is 1.58 times more volatile than Amundi Index Solutions. It trades about 0.03 of its total potential returns per unit of risk. Amundi Index Solutions is currently generating about 0.15 per unit of volatility. If you would invest 8,718 in Amundi Index Solutions on August 29, 2024 and sell it today you would earn a total of 2,541 from holding Amundi Index Solutions or generate 29.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.58% |
| Values | Daily Returns |
Microsoft vs. Amundi Index Solutions
Performance |
| Timeline |
| Microsoft |
| Amundi Index Solutions |
Microsoft and Amundi Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Amundi Index
The main advantage of trading using opposite Microsoft and Amundi Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Amundi Index 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 Amundi Index will offset losses from the drop in Amundi Index's long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. Block Inc | Microsoft vs. Adobe Systems Incorporated |
| Amundi Index vs. Amundi Index Solutions | Amundi Index vs. Amundi Index Solutions | Amundi Index vs. Amundi Index Solutions | Amundi Index vs. Amundi Index Solutions |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |