Correlation Between Microsoft and APAAU
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By analyzing existing cross correlation between Microsoft and APAAU 425 15 JUL 27, you can compare the effects of market volatilities on Microsoft and APAAU 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 APAAU. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and APAAU.
Diversification Opportunities for Microsoft and APAAU
Very good diversification
The 3 months correlation between Microsoft and APAAU is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and APAAU 425 15 JUL 27 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APAAU 425 15 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 APAAU. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APAAU 425 15 has no effect on the direction of Microsoft i.e., Microsoft and APAAU go up and down completely randomly.
Pair Corralation between Microsoft and APAAU
Given the investment horizon of 90 days Microsoft is expected to generate 1.96 times more return on investment than APAAU. However, Microsoft is 1.96 times more volatile than APAAU 425 15 JUL 27. It trades about 0.08 of its potential returns per unit of risk. APAAU 425 15 JUL 27 is currently generating about 0.03 per unit of risk. If you would invest 24,042 in Microsoft on August 28, 2024 and sell it today you would earn a total of 17,837 from holding Microsoft or generate 74.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 27.88% |
| Values | Daily Returns |
Microsoft vs. APAAU 425 15 JUL 27
Performance |
| Timeline |
| Microsoft |
| APAAU 425 15 |
Microsoft and APAAU Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and APAAU
The main advantage of trading using opposite Microsoft and APAAU positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, APAAU 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 APAAU will offset losses from the drop in APAAU'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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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