Correlation Between Microsoft and NeoMedia Technologies
Can any of the company-specific risk be diversified away by investing in both Microsoft and NeoMedia 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 NeoMedia Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and NeoMedia Technologies, you can compare the effects of market volatilities on Microsoft and NeoMedia 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 NeoMedia Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and NeoMedia Technologies.
Diversification Opportunities for Microsoft and NeoMedia Technologies
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Microsoft and NeoMedia is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and NeoMedia Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NeoMedia 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 NeoMedia Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NeoMedia Technologies has no effect on the direction of Microsoft i.e., Microsoft and NeoMedia Technologies go up and down completely randomly.
Pair Corralation between Microsoft and NeoMedia Technologies
If you would invest 41,098 in Microsoft on November 3, 2024 and sell it today you would earn a total of 408.00 from holding Microsoft or generate 0.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.4% |
| Values | Daily Returns |
Microsoft vs. NeoMedia Technologies
Performance |
| Timeline |
| Microsoft |
| NeoMedia Technologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Microsoft and NeoMedia Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and NeoMedia Technologies
The main advantage of trading using opposite Microsoft and NeoMedia Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, NeoMedia 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 NeoMedia Technologies will offset losses from the drop in NeoMedia Technologies' long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. Adobe Systems Incorporated | Microsoft vs. Crowdstrike Holdings |
| NeoMedia Technologies vs. AB International Group | NeoMedia Technologies vs. Peer To Peer | NeoMedia Technologies vs. AppYea Inc | NeoMedia Technologies vs. BASE Inc |
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 CEOs Directory module to screen CEOs from public companies around the world.
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