Correlation Between Microsoft and Glob Bioenergi
Can any of the company-specific risk be diversified away by investing in both Microsoft and Glob Bioenergi 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 Glob Bioenergi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Glob Bioenergi, you can compare the effects of market volatilities on Microsoft and Glob Bioenergi 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 Glob Bioenergi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Glob Bioenergi.
Diversification Opportunities for Microsoft and Glob Bioenergi
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Microsoft and Glob is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Glob Bioenergi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glob Bioenergi 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 Glob Bioenergi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glob Bioenergi has no effect on the direction of Microsoft i.e., Microsoft and Glob Bioenergi go up and down completely randomly.
Pair Corralation between Microsoft and Glob Bioenergi
Given the investment horizon of 90 days Microsoft is expected to generate 0.26 times more return on investment than Glob Bioenergi. However, Microsoft is 3.8 times less risky than Glob Bioenergi. It trades about -0.06 of its potential returns per unit of risk. Glob Bioenergi is currently generating about -0.21 per unit of risk. If you would invest 42,729 in Microsoft on August 26, 2024 and sell it today you would lose (1,029) from holding Microsoft or give up 2.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microsoft vs. Glob Bioenergi
Performance |
| Timeline |
| Microsoft |
| Glob Bioenergi |
Microsoft and Glob Bioenergi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Glob Bioenergi
The main advantage of trading using opposite Microsoft and Glob Bioenergi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Glob Bioenergi 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 Glob Bioenergi will offset losses from the drop in Glob Bioenergi's long position.| Microsoft vs. GigaCloud Technology Class | Microsoft vs. Arqit Quantum | Microsoft vs. Cemtrex | Microsoft vs. Rapid7 Inc |
| Glob Bioenergi vs. Neurones | Glob Bioenergi vs. Aubay Socit Anonyme | Glob Bioenergi vs. Infotel SA | Glob Bioenergi vs. Manitou BF SA |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Stocks Directory Find actively traded stocks across global markets |