Correlation Between Microsoft and Amundi German
Can any of the company-specific risk be diversified away by investing in both Microsoft and Amundi German 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 German into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Amundi German Bund, you can compare the effects of market volatilities on Microsoft and Amundi German 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 German. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Amundi German.
Diversification Opportunities for Microsoft and Amundi German
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Microsoft and Amundi is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Amundi German Bund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi German Bund 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 German. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi German Bund has no effect on the direction of Microsoft i.e., Microsoft and Amundi German go up and down completely randomly.
Pair Corralation between Microsoft and Amundi German
Given the investment horizon of 90 days Microsoft is expected to under-perform the Amundi German. In addition to that, Microsoft is 4.68 times more volatile than Amundi German Bund. It trades about -0.02 of its total potential returns per unit of risk. Amundi German Bund is currently generating about 0.09 per unit of volatility. If you would invest 6,233 in Amundi German Bund on August 30, 2024 and sell it today you would earn a total of 71.00 from holding Amundi German Bund or generate 1.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microsoft vs. Amundi German Bund
Performance |
| Timeline |
| Microsoft |
| Amundi German Bund |
Microsoft and Amundi German Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Amundi German
The main advantage of trading using opposite Microsoft and Amundi German positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Amundi German 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 German will offset losses from the drop in Amundi German's long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. Block Inc | Microsoft vs. Adobe Systems Incorporated |
| Amundi German vs. Amundi Index Solutions | Amundi German vs. Amundi Index Solutions | Amundi German vs. Amundi Index Solutions | Amundi German vs. Amundi SP 500 |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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