Correlation Between Microsoft and Amundi MSCI
Can any of the company-specific risk be diversified away by investing in both Microsoft and Amundi MSCI at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Microsoft and Amundi MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Amundi MSCI World, you can compare the effects of market volatilities on Microsoft and Amundi MSCI 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 Amundi MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Amundi MSCI.
Diversification Opportunities for Microsoft and Amundi MSCI
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Microsoft and Amundi is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Amundi MSCI World in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi MSCI World 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 Amundi MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi MSCI World has no effect on the direction of Microsoft i.e., Microsoft and Amundi MSCI go up and down completely randomly.
Pair Corralation between Microsoft and Amundi MSCI
Given the investment horizon of 90 days Microsoft is expected to generate 1.66 times more return on investment than Amundi MSCI. However, Microsoft is 1.66 times more volatile than Amundi MSCI World. It trades about 0.09 of its potential returns per unit of risk. Amundi MSCI World is currently generating about 0.03 per unit of risk. If you would invest 41,287 in Microsoft on October 22, 2024 and sell it today you would earn a total of 1,616 from holding Microsoft or generate 3.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.56% |
| Values | Daily Returns |
Microsoft vs. Amundi MSCI World
Performance |
| Timeline |
| Microsoft |
| Amundi MSCI World |
Microsoft and Amundi MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Amundi MSCI
The main advantage of trading using opposite Microsoft and Amundi MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Amundi MSCI 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 Amundi MSCI will offset losses from the drop in Amundi MSCI's long position.| Microsoft vs. Palo Alto Networks | Microsoft vs. Uipath Inc | Microsoft vs. BLOCK INC | Microsoft vs. Adobe Systems Incorporated |
| Amundi MSCI vs. Lyxor UCITS Japan | Amundi MSCI vs. Lyxor UCITS Japan | Amundi MSCI vs. Lyxor UCITS Stoxx | Amundi MSCI vs. Amundi CAC 40 |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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