Correlation Between Microsoft and Hamilton Global
Can any of the company-specific risk be diversified away by investing in both Microsoft and Hamilton Global 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 Hamilton Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Hamilton Global Opportunities, you can compare the effects of market volatilities on Microsoft and Hamilton Global 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 Hamilton Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Hamilton Global.
Diversification Opportunities for Microsoft and Hamilton Global
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Microsoft and Hamilton is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Hamilton Global Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamilton Global Oppo 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 Hamilton Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamilton Global Oppo has no effect on the direction of Microsoft i.e., Microsoft and Hamilton Global go up and down completely randomly.
Pair Corralation between Microsoft and Hamilton Global
Given the investment horizon of 90 days Microsoft is expected to under-perform the Hamilton Global. In addition to that, Microsoft is 2.76 times more volatile than Hamilton Global Opportunities. It trades about -0.03 of its total potential returns per unit of risk. Hamilton Global Opportunities is currently generating about 0.0 per unit of volatility. If you would invest 4,320 in Hamilton Global Opportunities on November 1, 2024 and sell it today you would earn a total of 0.00 from holding Hamilton Global Opportunities or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Microsoft vs. Hamilton Global Opportunities
Performance |
| Timeline |
| Microsoft |
| Hamilton Global Oppo |
Microsoft and Hamilton Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Hamilton Global
The main advantage of trading using opposite Microsoft and Hamilton Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Hamilton Global 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 Hamilton Global will offset losses from the drop in Hamilton Global's long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. Adobe Systems Incorporated | Microsoft vs. Crowdstrike Holdings |
| Hamilton Global vs. Affluent Medical SAS | Hamilton Global vs. NFL Biosciences SAS | Hamilton Global vs. Omer Decugis Cie | Hamilton Global vs. Winfarm |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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