Correlation Between Microsoft and SPECTRA
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By analyzing existing cross correlation between Microsoft and SPECTRA ENERGY PARTNERS, you can compare the effects of market volatilities on Microsoft and SPECTRA 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 SPECTRA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and SPECTRA.
Diversification Opportunities for Microsoft and SPECTRA
Average diversification
The 3 months correlation between Microsoft and SPECTRA is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and SPECTRA ENERGY PARTNERS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPECTRA ENERGY PARTNERS 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 SPECTRA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPECTRA ENERGY PARTNERS has no effect on the direction of Microsoft i.e., Microsoft and SPECTRA go up and down completely randomly.
Pair Corralation between Microsoft and SPECTRA
Given the investment horizon of 90 days Microsoft is expected to generate 5.65 times more return on investment than SPECTRA. However, Microsoft is 5.65 times more volatile than SPECTRA ENERGY PARTNERS. It trades about 0.09 of its potential returns per unit of risk. SPECTRA ENERGY PARTNERS is currently generating about 0.02 per unit of risk. If you would invest 24,341 in Microsoft on August 29, 2024 and sell it today you would earn a total of 18,458 from holding Microsoft or generate 75.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.96% |
| Values | Daily Returns |
Microsoft vs. SPECTRA ENERGY PARTNERS
Performance |
| Timeline |
| Microsoft |
| SPECTRA ENERGY PARTNERS |
Microsoft and SPECTRA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and SPECTRA
The main advantage of trading using opposite Microsoft and SPECTRA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, SPECTRA 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 SPECTRA will offset losses from the drop in SPECTRA'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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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