Correlation Between Microsoft and Ashot Ashkelon
Can any of the company-specific risk be diversified away by investing in both Microsoft and Ashot Ashkelon 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 Ashot Ashkelon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Ashot Ashkelon Industries, you can compare the effects of market volatilities on Microsoft and Ashot Ashkelon 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 Ashot Ashkelon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Ashot Ashkelon.
Diversification Opportunities for Microsoft and Ashot Ashkelon
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Microsoft and Ashot is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Ashot Ashkelon Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashot Ashkelon Industries 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 Ashot Ashkelon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashot Ashkelon Industries has no effect on the direction of Microsoft i.e., Microsoft and Ashot Ashkelon go up and down completely randomly.
Pair Corralation between Microsoft and Ashot Ashkelon
Given the investment horizon of 90 days Microsoft is expected to generate 0.32 times more return on investment than Ashot Ashkelon. However, Microsoft is 3.15 times less risky than Ashot Ashkelon. It trades about 0.19 of its potential returns per unit of risk. Ashot Ashkelon Industries is currently generating about -0.14 per unit of risk. If you would invest 40,554 in Microsoft on September 1, 2024 and sell it today you would earn a total of 1,792 from holding Microsoft or generate 4.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 85.71% |
| Values | Daily Returns |
Microsoft vs. Ashot Ashkelon Industries
Performance |
| Timeline |
| Microsoft |
| Ashot Ashkelon Industries |
Microsoft and Ashot Ashkelon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Ashot Ashkelon
The main advantage of trading using opposite Microsoft and Ashot Ashkelon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Ashot Ashkelon 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 Ashot Ashkelon will offset losses from the drop in Ashot Ashkelon's long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. Block Inc | Microsoft vs. Adobe Systems Incorporated |
| Ashot Ashkelon vs. Bet Shemesh Engines | Ashot Ashkelon vs. Elbit Systems | Ashot Ashkelon vs. Bezeq Israeli Telecommunication | Ashot Ashkelon vs. Rekah Pharmaceutical Industry |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |