This module allows you to analyze existing cross correlation between Expedia Inc and Microsoft Corporation. You can compare the effects of market volatilities on Expedia and Microsoft 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 Expedia with a short position of Microsoft. See also your portfolio center
. Please also check ongoing floating volatility patterns of Expedia
Expedia Inc. vs Microsoft Corp.
Given the investment horizon of 30 days, Expedia Inc is expected to generate 1.34 times more return on investment than Microsoft. However, Expedia is 1.34 times more volatile than Microsoft Corporation. It trades about 0.33 of its potential returns per unit of risk. Microsoft Corporation is currently generating about 0.04 per unit of risk. If you would invest 11,963 in Expedia Inc on February 23, 2017 and sell it today you would earn a total of 813.00 from holding Expedia Inc or generate 6.8% return on investment over 30 days.
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Very weak diversification
Overlapping area represents the amount of risk that can be diversified away by holding Expedia Inc. and Microsoft Corp. in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Microsoft and Expedia 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 Expedia Inc are associated (or correlated) with Microsoft. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microsoft has no effect on the direction of Expedia i.e. Expedia and Microsoft go up and down completely randomly.
Compared to the overall equity markets, risk-adjusted returns on investments in Expedia Inc are ranked lower than 22 (%) of all global equities and portfolios over the last 30 days.
Compared to the overall equity markets, risk-adjusted returns on investments in Microsoft Corporation are ranked lower than 2 (%) of all global equities and portfolios over the last 30 days.