Correlation Between Microsoft and UBS Barclays
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By analyzing existing cross correlation between Microsoft and UBS Barclays Liquid, you can compare the effects of market volatilities on Microsoft and UBS Barclays 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 UBS Barclays. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and UBS Barclays.
Diversification Opportunities for Microsoft and UBS Barclays
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Microsoft and UBS is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and UBS Barclays Liquid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS Barclays Liquid 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 UBS Barclays. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS Barclays Liquid has no effect on the direction of Microsoft i.e., Microsoft and UBS Barclays go up and down completely randomly.
Pair Corralation between Microsoft and UBS Barclays
Given the investment horizon of 90 days Microsoft is expected to generate 2.47 times more return on investment than UBS Barclays. However, Microsoft is 2.47 times more volatile than UBS Barclays Liquid. It trades about 0.19 of its potential returns per unit of risk. UBS Barclays Liquid is currently generating about 0.42 per unit of risk. If you would invest 40,554 in Microsoft on September 1, 2024 and sell it today you would earn a total of 1,792 from holding Microsoft or generate 4.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Microsoft vs. UBS Barclays Liquid
Performance |
| Timeline |
| Microsoft |
| UBS Barclays Liquid |
Microsoft and UBS Barclays Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and UBS Barclays
The main advantage of trading using opposite Microsoft and UBS Barclays positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, UBS Barclays 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 UBS Barclays will offset losses from the drop in UBS Barclays' long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. Block Inc | Microsoft vs. Adobe Systems Incorporated |
| UBS Barclays vs. Xtrackers Nikkei 225 | UBS Barclays vs. iShares VII PLC | UBS Barclays vs. NMI Holdings | UBS Barclays vs. SIVERS SEMICONDUCTORS AB |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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