Correlation Between Microsoft and JNS Holdings
Can any of the company-specific risk be diversified away by investing in both Microsoft and JNS 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 JNS Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and JNS Holdings Corp, you can compare the effects of market volatilities on Microsoft and JNS 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 JNS Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and JNS Holdings.
Diversification Opportunities for Microsoft and JNS Holdings
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Microsoft and JNS is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and JNS Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JNS 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 JNS Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JNS Holdings Corp has no effect on the direction of Microsoft i.e., Microsoft and JNS Holdings go up and down completely randomly.
Pair Corralation between Microsoft and JNS Holdings
Given the investment horizon of 90 days Microsoft is expected to generate 0.67 times more return on investment than JNS Holdings. However, Microsoft is 1.5 times less risky than JNS Holdings. It trades about -0.01 of its potential returns per unit of risk. JNS Holdings Corp is currently generating about -0.04 per unit of risk. If you would invest 41,858 in Microsoft on November 3, 2024 and sell it today you would lose (352.00) from holding Microsoft or give up 0.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microsoft vs. JNS Holdings Corp
Performance |
| Timeline |
| Microsoft |
| JNS Holdings Corp |
Microsoft and JNS Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and JNS Holdings
The main advantage of trading using opposite Microsoft and JNS Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, JNS 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 JNS Holdings will offset losses from the drop in JNS Holdings' long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. Adobe Systems Incorporated | Microsoft vs. Crowdstrike Holdings |
| JNS Holdings vs. Digital Locations | JNS Holdings vs. Orion Group Holdings | JNS Holdings vs. Vinci SA ADR | JNS Holdings vs. Agrify Corp |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |