Correlation Between Microsoft and Weaccess Group
Can any of the company-specific risk be diversified away by investing in both Microsoft and Weaccess Group 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 Weaccess Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Weaccess Group SA, you can compare the effects of market volatilities on Microsoft and Weaccess Group 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 Weaccess Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Weaccess Group.
Diversification Opportunities for Microsoft and Weaccess Group
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Microsoft and Weaccess is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Weaccess Group SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weaccess Group SA 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 Weaccess Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weaccess Group SA has no effect on the direction of Microsoft i.e., Microsoft and Weaccess Group go up and down completely randomly.
Pair Corralation between Microsoft and Weaccess Group
Given the investment horizon of 90 days Microsoft is expected to generate 0.27 times more return on investment than Weaccess Group. However, Microsoft is 3.68 times less risky than Weaccess Group. It trades about 0.17 of its potential returns per unit of risk. Weaccess Group SA is currently generating about -0.15 per unit of risk. If you would invest 41,879 in Microsoft on September 24, 2024 and sell it today you would earn a total of 1,781 from holding Microsoft or generate 4.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 95.24% |
Values | Daily Returns |
Microsoft vs. Weaccess Group SA
Performance |
Timeline |
Microsoft |
Weaccess Group SA |
Microsoft and Weaccess Group Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Microsoft and Weaccess Group
The main advantage of trading using opposite Microsoft and Weaccess Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Weaccess Group 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 Weaccess Group will offset losses from the drop in Weaccess Group's long position.Microsoft vs. BlackBerry | Microsoft vs. Global Blue Group | Microsoft vs. Aurora Mobile | Microsoft vs. Marqeta |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |