Correlation Between Microsoft and Citycon Oyj
Can any of the company-specific risk be diversified away by investing in both Microsoft and Citycon Oyj 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 Citycon Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Citycon Oyj, you can compare the effects of market volatilities on Microsoft and Citycon Oyj 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 Citycon Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Citycon Oyj.
Diversification Opportunities for Microsoft and Citycon Oyj
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Microsoft and Citycon is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Citycon Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citycon Oyj 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 Citycon Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citycon Oyj has no effect on the direction of Microsoft i.e., Microsoft and Citycon Oyj go up and down completely randomly.
Pair Corralation between Microsoft and Citycon Oyj
Given the investment horizon of 90 days Microsoft is expected to generate 1.0 times more return on investment than Citycon Oyj. However, Microsoft is as risky as Citycon Oyj. It trades about 0.08 of its potential returns per unit of risk. Citycon Oyj is currently generating about -0.06 per unit of risk. If you would invest 24,116 in Microsoft on August 27, 2024 and sell it today you would earn a total of 17,584 from holding Microsoft or generate 72.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Microsoft vs. Citycon Oyj
Performance |
| Timeline |
| Microsoft |
| Citycon Oyj |
Microsoft and Citycon Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Citycon Oyj
The main advantage of trading using opposite Microsoft and Citycon Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Citycon Oyj 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 Citycon Oyj will offset losses from the drop in Citycon Oyj's long position.| Microsoft vs. GigaCloud Technology Class | Microsoft vs. Arqit Quantum | Microsoft vs. Cemtrex | Microsoft vs. Rapid7 Inc |
| Citycon Oyj vs. Sampo Oyj A | Citycon Oyj vs. Tokmanni Group Oyj | Citycon Oyj vs. Nordea Bank Abp | Citycon Oyj vs. Telia Company AB |
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
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |