Correlation Between Microsoft and GraniteShares 125x

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Can any of the company-specific risk be diversified away by investing in both Microsoft and GraniteShares 125x 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 GraniteShares 125x into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and GraniteShares 125x Long, you can compare the effects of market volatilities on Microsoft and GraniteShares 125x 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 GraniteShares 125x. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and GraniteShares 125x.

Diversification Opportunities for Microsoft and GraniteShares 125x

MicrosoftGraniteSharesDiversified AwayMicrosoftGraniteSharesDiversified Away100%
0.74
  Correlation Coefficient

Poor diversification

The 3 months correlation between Microsoft and GraniteShares is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and GraniteShares 125x Long in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GraniteShares 125x Long 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 GraniteShares 125x. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GraniteShares 125x Long has no effect on the direction of Microsoft i.e., Microsoft and GraniteShares 125x go up and down completely randomly.

Pair Corralation between Microsoft and GraniteShares 125x

Given the investment horizon of 90 days Microsoft is expected to generate 17.16 times less return on investment than GraniteShares 125x. But when comparing it to its historical volatility, Microsoft is 4.69 times less risky than GraniteShares 125x. It trades about 0.05 of its potential returns per unit of risk. GraniteShares 125x Long is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  977.00  in GraniteShares 125x Long on October 5, 2024 and sell it today you would earn a total of  773.00  from holding GraniteShares 125x Long or generate 79.12% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Microsoft  vs.  GraniteShares 125x Long

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -20020406080100
JavaScript chart by amCharts 3.21.15MSFT TSL
       Timeline  
Microsoft 

Risk-Adjusted Performance

3 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Microsoft are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Microsoft is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan410420430440450
GraniteShares 125x Long 

Risk-Adjusted Performance

14 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in GraniteShares 125x Long are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, GraniteShares 125x disclosed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan1012141618202224

Microsoft and GraniteShares 125x Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-2.14-1.61-1.08-0.55-0.030.471.01.532.062.59 0.050.100.150.20
JavaScript chart by amCharts 3.21.15MSFT TSL
       Returns  

Pair Trading with Microsoft and GraniteShares 125x

The main advantage of trading using opposite Microsoft and GraniteShares 125x positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, GraniteShares 125x 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 GraniteShares 125x will offset losses from the drop in GraniteShares 125x's long position.
The idea behind Microsoft and GraniteShares 125x Long 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.

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