Correlation Between Microsoft and Hyliion Holdings
Can any of the company-specific risk be diversified away by investing in both Microsoft and Hyliion Holdings 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 Hyliion Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Hyliion Holdings Corp, you can compare the effects of market volatilities on Microsoft and Hyliion Holdings 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 Hyliion Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Hyliion Holdings.
Diversification Opportunities for Microsoft and Hyliion Holdings
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Microsoft and Hyliion is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Hyliion Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyliion Holdings Corp 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 Hyliion Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyliion Holdings Corp has no effect on the direction of Microsoft i.e., Microsoft and Hyliion Holdings go up and down completely randomly.
Pair Corralation between Microsoft and Hyliion Holdings
Given the investment horizon of 90 days Microsoft is expected to generate 0.27 times more return on investment than Hyliion Holdings. However, Microsoft is 3.7 times less risky than Hyliion Holdings. It trades about -0.01 of its potential returns per unit of risk. Hyliion Holdings Corp is currently generating about -0.06 per unit of risk. If you would invest 41,493 in Microsoft on November 18, 2024 and sell it today you would lose (650.00) from holding Microsoft or give up 1.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microsoft vs. Hyliion Holdings Corp
Performance |
| Timeline |
| Microsoft |
| Hyliion Holdings Corp |
Microsoft and Hyliion Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Hyliion Holdings
The main advantage of trading using opposite Microsoft and Hyliion Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Hyliion Holdings 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 Hyliion Holdings will offset losses from the drop in Hyliion Holdings' long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. Adobe Systems Incorporated | Microsoft vs. Crowdstrike Holdings |
| Hyliion Holdings vs. Quantumscape Corp | Hyliion Holdings vs. Mobileye Global Class | Hyliion Holdings vs. Innoviz Technologies | Hyliion Holdings vs. Aeva Technologies, Common |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |