Correlation Between Microsoft and Jhancock Diversified
Can any of the company-specific risk be diversified away by investing in both Microsoft and Jhancock Diversified 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 Jhancock Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Jhancock Diversified Macro, you can compare the effects of market volatilities on Microsoft and Jhancock Diversified 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 Jhancock Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Jhancock Diversified.
Diversification Opportunities for Microsoft and Jhancock Diversified
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Microsoft and Jhancock is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Jhancock Diversified Macro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Diversified 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 Jhancock Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jhancock Diversified has no effect on the direction of Microsoft i.e., Microsoft and Jhancock Diversified go up and down completely randomly.
Pair Corralation between Microsoft and Jhancock Diversified
Given the investment horizon of 90 days Microsoft is expected to generate 2.52 times more return on investment than Jhancock Diversified. However, Microsoft is 2.52 times more volatile than Jhancock Diversified Macro. It trades about -0.03 of its potential returns per unit of risk. Jhancock Diversified Macro is currently generating about -0.11 per unit of risk. If you would invest 42,717 in Microsoft on August 28, 2024 and sell it today you would lose (838.00) from holding Microsoft or give up 1.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microsoft vs. Jhancock Diversified Macro
Performance |
| Timeline |
| Microsoft |
| Jhancock Diversified |
Microsoft and Jhancock Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Jhancock Diversified
The main advantage of trading using opposite Microsoft and Jhancock Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Jhancock Diversified 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 Jhancock Diversified will offset losses from the drop in Jhancock Diversified's long position.| Microsoft vs. GigaCloud Technology Class | Microsoft vs. Arqit Quantum | Microsoft vs. Cemtrex | Microsoft vs. Paysafe |
| Jhancock Diversified vs. Iaadx | Jhancock Diversified vs. Rbb Fund | Jhancock Diversified vs. Falcon Focus Scv | Jhancock Diversified vs. Leggmason Partners Institutional |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |