Correlation Between Microsoft and Curative Biosciences
Can any of the company-specific risk be diversified away by investing in both Microsoft and Curative Biosciences 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 Curative Biosciences into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Curative Biosciences, you can compare the effects of market volatilities on Microsoft and Curative Biosciences 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 Curative Biosciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Curative Biosciences.
Diversification Opportunities for Microsoft and Curative Biosciences
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Microsoft and Curative is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Curative Biosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Curative Biosciences 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 Curative Biosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Curative Biosciences has no effect on the direction of Microsoft i.e., Microsoft and Curative Biosciences go up and down completely randomly.
Pair Corralation between Microsoft and Curative Biosciences
Given the investment horizon of 90 days Microsoft is expected to generate 1.54 times less return on investment than Curative Biosciences. But when comparing it to its historical volatility, Microsoft is 6.87 times less risky than Curative Biosciences. It trades about 0.09 of its potential returns per unit of risk. Curative Biosciences is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 0.13 in Curative Biosciences on August 29, 2024 and sell it today you would lose (0.12) from holding Curative Biosciences or give up 92.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microsoft vs. Curative Biosciences
Performance |
| Timeline |
| Microsoft |
| Curative Biosciences |
Microsoft and Curative Biosciences Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Curative Biosciences
The main advantage of trading using opposite Microsoft and Curative Biosciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Curative Biosciences 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 Curative Biosciences will offset losses from the drop in Curative Biosciences' long position.| Microsoft vs. GigaCloud Technology Class | Microsoft vs. Arqit Quantum | Microsoft vs. Cemtrex | Microsoft vs. Paysafe |
| Curative Biosciences vs. CuraScientific Corp | Curative Biosciences vs. ManifestSeven Holdings | Curative Biosciences vs. Rimrock Gold Corp | Curative Biosciences vs. Amazonas Florestal |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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