Correlation Between Winshear Gold and Microsoft Corp

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

By analyzing existing cross correlation between Winshear Gold Corp and Microsoft Corp CDR, you can compare the effects of market volatilities on Winshear Gold and Microsoft Corp 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 Winshear Gold with a short position of Microsoft Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Winshear Gold and Microsoft Corp.

Diversification Opportunities for Winshear Gold and Microsoft Corp

0.44

Correlation Coefficient

Winshear Gold  Microsoft Corp

Very weak diversification

The 3 months correlation between Winshear and Microsoft is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Winshear Gold Corp and Microsoft Corp CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microsoft Corp CDR and Winshear Gold 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 Winshear Gold Corp are associated (or correlated) with Microsoft Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microsoft Corp CDR has no effect on the direction of Winshear Gold i.e., Winshear Gold and Microsoft Corp go up and down completely randomly.

Pair Corralation between Winshear Gold and Microsoft Corp

Assuming the 90 days trading horizon Winshear Gold Corp is expected to under-perform the Microsoft Corp. In addition to that, Winshear Gold is 7.44 times more volatile than Microsoft Corp CDR. It trades about -0.03 of its total potential returns per unit of risk. Microsoft Corp CDR is currently generating about -0.09 per unit of volatility. If you would invest  3,140  in Microsoft Corp CDR on December 1, 2024 and sell it today you would lose (256.00) from holding Microsoft Corp CDR or give up 8.15% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Winshear Gold Corp  vs.  Microsoft Corp CDR

Winshear Gold Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Winshear Gold Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Microsoft Corp CDR

Risk-Adjusted Performance

Very Weak

Over the last 90 days Microsoft Corp CDR 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 sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Winshear Gold and Microsoft Corp

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

The idea behind Winshear Gold Corp and Microsoft Corp CDR 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.