Correlation Between Microsoft and CH Karnchang
Can any of the company-specific risk be diversified away by investing in both Microsoft and CH Karnchang 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 CH Karnchang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and CH Karnchang Public, you can compare the effects of market volatilities on Microsoft and CH Karnchang 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 CH Karnchang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and CH Karnchang.
Diversification Opportunities for Microsoft and CH Karnchang
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Microsoft and CH Karnchang is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and CH Karnchang Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CH Karnchang Public 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 CH Karnchang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CH Karnchang Public has no effect on the direction of Microsoft i.e., Microsoft and CH Karnchang go up and down completely randomly.
Pair Corralation between Microsoft and CH Karnchang
Given the investment horizon of 90 days Microsoft is expected to generate 1.04 times more return on investment than CH Karnchang. However, Microsoft is 1.04 times more volatile than CH Karnchang Public. It trades about 0.02 of its potential returns per unit of risk. CH Karnchang Public is currently generating about -0.09 per unit of risk. If you would invest 42,574 in Microsoft on August 29, 2024 and sell it today you would earn a total of 225.00 from holding Microsoft or generate 0.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microsoft vs. CH Karnchang Public
Performance |
| Timeline |
| Microsoft |
| CH Karnchang Public |
Microsoft and CH Karnchang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and CH Karnchang
The main advantage of trading using opposite Microsoft and CH Karnchang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, CH Karnchang 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 CH Karnchang will offset losses from the drop in CH Karnchang's long position.| Microsoft vs. GigaCloud Technology Class | Microsoft vs. Arqit Quantum | Microsoft vs. Cemtrex | Microsoft vs. Paysafe |
| CH Karnchang vs. Tata Steel Public | CH Karnchang vs. Thaifoods Group Public | CH Karnchang vs. TMT Steel Public | CH Karnchang vs. The Erawan Group |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |