Correlation Between Microsoft and 98389BAN0
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By analyzing existing cross correlation between Microsoft and XCEL ENERGY INC, you can compare the effects of market volatilities on Microsoft and 98389BAN0 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 98389BAN0. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and 98389BAN0.
Diversification Opportunities for Microsoft and 98389BAN0
Modest diversification
The 3 months correlation between Microsoft and 98389BAN0 is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and XCEL ENERGY INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XCEL ENERGY INC 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 98389BAN0. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XCEL ENERGY INC has no effect on the direction of Microsoft i.e., Microsoft and 98389BAN0 go up and down completely randomly.
Pair Corralation between Microsoft and 98389BAN0
Given the investment horizon of 90 days Microsoft is expected to generate 1.45 times more return on investment than 98389BAN0. However, Microsoft is 1.45 times more volatile than XCEL ENERGY INC. It trades about -0.04 of its potential returns per unit of risk. XCEL ENERGY INC is currently generating about -0.19 per unit of risk. If you would invest 43,167 in Microsoft on August 31, 2024 and sell it today you would lose (868.00) from holding Microsoft or give up 2.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 54.55% |
| Values | Daily Returns |
Microsoft vs. XCEL ENERGY INC
Performance |
| Timeline |
| Microsoft |
| XCEL ENERGY INC |
Microsoft and 98389BAN0 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and 98389BAN0
The main advantage of trading using opposite Microsoft and 98389BAN0 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, 98389BAN0 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 98389BAN0 will offset losses from the drop in 98389BAN0's long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. Block Inc | Microsoft vs. Adobe Systems Incorporated |
| 98389BAN0 vs. AEP TEX INC | 98389BAN0 vs. US BANK NATIONAL | 98389BAN0 vs. International Business Machines | 98389BAN0 vs. Intel |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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