Correlation Between Microsoft and Kore Mining
Can any of the company-specific risk be diversified away by investing in both Microsoft and Kore Mining 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 Kore Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Kore Mining, you can compare the effects of market volatilities on Microsoft and Kore Mining 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 Kore Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Kore Mining.
Diversification Opportunities for Microsoft and Kore Mining
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Microsoft and Kore is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Kore Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kore Mining 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 Kore Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kore Mining has no effect on the direction of Microsoft i.e., Microsoft and Kore Mining go up and down completely randomly.
Pair Corralation between Microsoft and Kore Mining
Given the investment horizon of 90 days Microsoft is expected to generate 0.27 times more return on investment than Kore Mining. However, Microsoft is 3.72 times less risky than Kore Mining. It trades about 0.0 of its potential returns per unit of risk. Kore Mining is currently generating about -0.06 per unit of risk. If you would invest 42,574 in Microsoft on August 29, 2024 and sell it today you would lose (188.00) from holding Microsoft or give up 0.44% 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. Kore Mining
Performance |
| Timeline |
| Microsoft |
| Kore Mining |
Microsoft and Kore Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Kore Mining
The main advantage of trading using opposite Microsoft and Kore Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Kore Mining 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 Kore Mining will offset losses from the drop in Kore Mining's long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. Block Inc | Microsoft vs. Adobe Systems Incorporated |
| Kore Mining vs. Outcrop Gold Corp | Kore Mining vs. Grande Portage Resources | Kore Mining vs. Bluestone Resources | Kore Mining vs. Lumina Gold 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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