Correlation Between Microsoft and MEITAV INVESTMENTS
Can any of the company-specific risk be diversified away by investing in both Microsoft and MEITAV INVESTMENTS 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 MEITAV INVESTMENTS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and MEITAV INVESTMENTS HOUSE, you can compare the effects of market volatilities on Microsoft and MEITAV INVESTMENTS 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 MEITAV INVESTMENTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and MEITAV INVESTMENTS.
Diversification Opportunities for Microsoft and MEITAV INVESTMENTS
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Microsoft and MEITAV is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and MEITAV INVESTMENTS HOUSE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MEITAV INVESTMENTS HOUSE 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 MEITAV INVESTMENTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MEITAV INVESTMENTS HOUSE has no effect on the direction of Microsoft i.e., Microsoft and MEITAV INVESTMENTS go up and down completely randomly.
Pair Corralation between Microsoft and MEITAV INVESTMENTS
Given the investment horizon of 90 days Microsoft is expected to generate 55.48 times less return on investment than MEITAV INVESTMENTS. But when comparing it to its historical volatility, Microsoft is 1.64 times less risky than MEITAV INVESTMENTS. It trades about 0.02 of its potential returns per unit of risk. MEITAV INVESTMENTS HOUSE is currently generating about 0.75 of returns per unit of risk over similar time horizon. If you would invest 191,700 in MEITAV INVESTMENTS HOUSE on August 29, 2024 and sell it today you would earn a total of 88,000 from holding MEITAV INVESTMENTS HOUSE or generate 45.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 81.82% |
| Values | Daily Returns |
Microsoft vs. MEITAV INVESTMENTS HOUSE
Performance |
| Timeline |
| Microsoft |
| MEITAV INVESTMENTS HOUSE |
Microsoft and MEITAV INVESTMENTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and MEITAV INVESTMENTS
The main advantage of trading using opposite Microsoft and MEITAV INVESTMENTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, MEITAV INVESTMENTS 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 MEITAV INVESTMENTS will offset losses from the drop in MEITAV INVESTMENTS's long position.| Microsoft vs. GigaCloud Technology Class | Microsoft vs. Arqit Quantum | Microsoft vs. Cemtrex | Microsoft vs. Paysafe |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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