Correlation Between Microsoft and Personel Alih
Can any of the company-specific risk be diversified away by investing in both Microsoft and Personel Alih 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 Personel Alih into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Personel Alih Daya, you can compare the effects of market volatilities on Microsoft and Personel Alih 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 Personel Alih. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Personel Alih.
Diversification Opportunities for Microsoft and Personel Alih
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Microsoft and Personel is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Personel Alih Daya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Personel Alih Daya 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 Personel Alih. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Personel Alih Daya has no effect on the direction of Microsoft i.e., Microsoft and Personel Alih go up and down completely randomly.
Pair Corralation between Microsoft and Personel Alih
Given the investment horizon of 90 days Microsoft is expected to generate 0.3 times more return on investment than Personel Alih. However, Microsoft is 3.37 times less risky than Personel Alih. It trades about 0.04 of its potential returns per unit of risk. Personel Alih Daya is currently generating about -0.13 per unit of risk. If you would invest 37,173 in Microsoft on August 27, 2024 and sell it today you would earn a total of 4,527 from holding Microsoft or generate 12.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.35% |
| Values | Daily Returns |
Microsoft vs. Personel Alih Daya
Performance |
| Timeline |
| Microsoft |
| Personel Alih Daya |
Microsoft and Personel Alih Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Personel Alih
The main advantage of trading using opposite Microsoft and Personel Alih positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Personel Alih 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 Personel Alih will offset losses from the drop in Personel Alih's long position.| Microsoft vs. GigaCloud Technology Class | Microsoft vs. Arqit Quantum | Microsoft vs. Cemtrex | Microsoft vs. Rapid7 Inc |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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