Correlation Between Microsoft and Lesaka Technologies
Can any of the company-specific risk be diversified away by investing in both Microsoft and Lesaka Technologies 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 Lesaka Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Lesaka Technologies, you can compare the effects of market volatilities on Microsoft and Lesaka Technologies 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 Lesaka Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Lesaka Technologies.
Diversification Opportunities for Microsoft and Lesaka Technologies
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Microsoft and Lesaka is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Lesaka Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lesaka Technologies 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 Lesaka Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lesaka Technologies has no effect on the direction of Microsoft i.e., Microsoft and Lesaka Technologies go up and down completely randomly.
Pair Corralation between Microsoft and Lesaka Technologies
Given the investment horizon of 90 days Microsoft is expected to generate 0.65 times more return on investment than Lesaka Technologies. However, Microsoft is 1.54 times less risky than Lesaka Technologies. It trades about 0.02 of its potential returns per unit of risk. Lesaka Technologies is currently generating about -0.03 per unit of risk. If you would invest 42,574 in Microsoft on August 28, 2024 and sell it today you would earn a total of 225.00 from holding Microsoft or generate 0.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microsoft vs. Lesaka Technologies
Performance |
| Timeline |
| Microsoft |
| Lesaka Technologies |
Microsoft and Lesaka Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Lesaka Technologies
The main advantage of trading using opposite Microsoft and Lesaka Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Lesaka Technologies 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 Lesaka Technologies will offset losses from the drop in Lesaka Technologies' long position.| Microsoft vs. GigaCloud Technology Class | Microsoft vs. Arqit Quantum | Microsoft vs. Cemtrex | Microsoft vs. Paysafe |
| Lesaka Technologies vs. Centaur Bci Balanced | Lesaka Technologies vs. Growthpoint Properties | Lesaka Technologies vs. Bowler Metcalf | Lesaka Technologies vs. Shoprite Holdings |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |