Correlation Between Microsoft and FLAT GLASS
Can any of the company-specific risk be diversified away by investing in both Microsoft and FLAT GLASS 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 FLAT GLASS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and FLAT GLASS GROUP, you can compare the effects of market volatilities on Microsoft and FLAT GLASS 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 FLAT GLASS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and FLAT GLASS.
Diversification Opportunities for Microsoft and FLAT GLASS
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Microsoft and FLAT is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and FLAT GLASS GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FLAT GLASS GROUP 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 FLAT GLASS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FLAT GLASS GROUP has no effect on the direction of Microsoft i.e., Microsoft and FLAT GLASS go up and down completely randomly.
Pair Corralation between Microsoft and FLAT GLASS
Given the investment horizon of 90 days Microsoft is expected to generate 1.28 times less return on investment than FLAT GLASS. But when comparing it to its historical volatility, Microsoft is 4.65 times less risky than FLAT GLASS. It trades about 0.49 of its potential returns per unit of risk. FLAT GLASS GROUP is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 135.00 in FLAT GLASS GROUP on September 18, 2024 and sell it today you would earn a total of 14.00 from holding FLAT GLASS GROUP or generate 10.37% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 95.24% |
Values | Daily Returns |
Microsoft vs. FLAT GLASS GROUP
Performance |
Timeline |
Microsoft |
FLAT GLASS GROUP |
Microsoft and FLAT GLASS Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Microsoft and FLAT GLASS
The main advantage of trading using opposite Microsoft and FLAT GLASS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, FLAT GLASS 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 FLAT GLASS will offset losses from the drop in FLAT GLASS's long position.Microsoft vs. Global Blue Group | Microsoft vs. Aurora Mobile | Microsoft vs. Marqeta | Microsoft vs. Nextnav Acquisition Corp |
FLAT GLASS vs. Carrier Global | FLAT GLASS vs. Geberit AG | FLAT GLASS vs. Superior Plus Corp | FLAT GLASS vs. Origin Agritech |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
Equity Valuation Check real value of public entities based on technical and fundamental data | |
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |