Correlation Between Microsoft and Korfez Gayrimenkul

Can any of the company-specific risk be diversified away by investing in both Microsoft and Korfez Gayrimenkul 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 Korfez Gayrimenkul into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Microsoft and Korfez Gayrimenkul Yatirim, you can compare the effects of market volatilities on Microsoft and Korfez Gayrimenkul 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 Korfez Gayrimenkul. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Korfez Gayrimenkul.

Diversification Opportunities for Microsoft and Korfez Gayrimenkul

-0.64

Correlation Coefficient

Microsoft  Korfez Gayrimenkul

Excellent diversification

The 3 months correlation between Microsoft and Korfez is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Korfez Gayrimenkul Yatirim in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korfez Gayrimenkul 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 Korfez Gayrimenkul. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korfez Gayrimenkul has no effect on the direction of Microsoft i.e., Microsoft and Korfez Gayrimenkul go up and down completely randomly.

Pair Corralation between Microsoft and Korfez Gayrimenkul

Given the investment horizon of 90 days Microsoft is expected to generate 4.19 times less return on investment than Korfez Gayrimenkul. But when comparing it to its historical volatility, Microsoft is 3.14 times less risky than Korfez Gayrimenkul. It trades about 0.07 of its potential returns per unit of risk. Korfez Gayrimenkul Yatirim is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  271.00  in Korfez Gayrimenkul Yatirim on December 4, 2024 and sell it today you would earn a total of  829.00  from holding Korfez Gayrimenkul Yatirim or generate 305.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	99.8%
Values	Daily Returns

Microsoft  vs.  Korfez Gayrimenkul Yatirim

Microsoft

Risk-Adjusted Performance

Very Weak

Over the last 90 days Microsoft has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's technical and fundamental indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Korfez Gayrimenkul

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Korfez Gayrimenkul Yatirim are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Korfez Gayrimenkul demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Microsoft and Korfez Gayrimenkul

The main advantage of trading using opposite Microsoft and Korfez Gayrimenkul positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Korfez Gayrimenkul 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 Korfez Gayrimenkul will offset losses from the drop in Korfez Gayrimenkul's long position.

The idea behind Microsoft and Korfez Gayrimenkul Yatirim pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.