Correlation Between Microsoft and CONSOLIDATED
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By analyzing existing cross correlation between Microsoft and CONSOLIDATED EDISON N, you can compare the effects of market volatilities on Microsoft and CONSOLIDATED 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 CONSOLIDATED. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and CONSOLIDATED.
Diversification Opportunities for Microsoft and CONSOLIDATED
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Microsoft and CONSOLIDATED is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and CONSOLIDATED EDISON N in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CONSOLIDATED EDISON 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 CONSOLIDATED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CONSOLIDATED EDISON has no effect on the direction of Microsoft i.e., Microsoft and CONSOLIDATED go up and down completely randomly.
Pair Corralation between Microsoft and CONSOLIDATED
Given the investment horizon of 90 days Microsoft is expected to generate 123.14 times less return on investment than CONSOLIDATED. But when comparing it to its historical volatility, Microsoft is 87.03 times less risky than CONSOLIDATED. It trades about 0.08 of its potential returns per unit of risk. CONSOLIDATED EDISON N is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 8,744 in CONSOLIDATED EDISON N on September 3, 2024 and sell it today you would lose (398.00) from holding CONSOLIDATED EDISON N or give up 4.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 51.52% |
| Values | Daily Returns |
Microsoft vs. CONSOLIDATED EDISON N
Performance |
| Timeline |
| Microsoft |
| CONSOLIDATED EDISON |
Microsoft and CONSOLIDATED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and CONSOLIDATED
The main advantage of trading using opposite Microsoft and CONSOLIDATED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, CONSOLIDATED 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 CONSOLIDATED will offset losses from the drop in CONSOLIDATED's long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. Block Inc | Microsoft vs. Adobe Systems Incorporated |
| CONSOLIDATED vs. Reservoir Media | CONSOLIDATED vs. RLX Technology | CONSOLIDATED vs. Viemed Healthcare | CONSOLIDATED vs. Ispire Technology Common |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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