Correlation Between Fireeye and Microsoft
Can any of the company-specific risk be diversified away by investing in both Fireeye and Microsoft 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 Fireeye and Microsoft into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fireeye and Microsoft, you can compare the effects of market volatilities on Fireeye 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 Fireeye with a short position of Microsoft. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fireeye and Microsoft.
Diversification Opportunities for Fireeye and Microsoft
Pay attention - limited upside
The 3 months correlation between Fireeye and Microsoft is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fireeye and Microsoft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microsoft and Fireeye 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 Fireeye 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 Fireeye i.e., Fireeye and Microsoft go up and down completely randomly.
Pair Corralation between Fireeye and Microsoft
If you would invest 26,828 in Microsoft on December 29, 2023 and sell it today you would earn a total of 15,315 from holding Microsoft or generate 57.09% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Fireeye vs. Microsoft
Performance |
Timeline |
Fireeye |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
Microsoft |
Fireeye and Microsoft Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fireeye and Microsoft
The main advantage of trading using opposite Fireeye and Microsoft positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fireeye position performs unexpectedly, Microsoft 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 will offset losses from the drop in Microsoft's long position.Fireeye vs. Comstock Holding Companies | Fireeye vs. Uber Technologies | Fireeye vs. Arrow Electronics | Fireeye vs. Allient |
Microsoft vs. Global Blue Group | Microsoft vs. Aurora Mobile | Microsoft vs. Marqeta | Microsoft vs. Nextnav Acquisition Corp |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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