Correlation Analysis Between Microsoft and Expedia

This module allows you to analyze existing cross correlation between Microsoft Corporation and Expedia. You can compare the effects of market volatilities on Microsoft and Expedia 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 Expedia. See also your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Expedia.
 Time Horizon     30 Days    Login   to change
Symbolsvs

Microsoft Corp.  vs.  Expedia Inc

 Performance (%) 
      Timeline 

Pair Volatility

Given the investment horizon of 30 days, Microsoft is expected to generate 2.36 times less return on investment than Expedia. But when comparing it to its historical volatility, Microsoft Corporation is 1.45 times less risky than Expedia. It trades about 0.17 of its potential returns per unit of risk. Expedia is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest  11,636  in Expedia on May 20, 2018 and sell it today you would earn a total of  831.00  from holding Expedia or generate 7.14% return on investment over 30 days.

Pair Corralation between Microsoft and Expedia

0.75
Time Period1 Month [change]
DirectionPositive 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Diversification

Poor diversification

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

Comparative Volatility

 Predicted Return Density 
      Returns 
Microsoft  
11 

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Microsoft Corporation are ranked lower than 11 (%) of all global equities and portfolios over the last 30 days.
Expedia  
18 

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Expedia are ranked lower than 18 (%) of all global equities and portfolios over the last 30 days.

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GOOG - USA Stock
Alphabet
Specialization
IT, Search Cloud And Integrated IT Services
Business Address1600 Amphitheatre Parkway
ExchangeNASDAQ
$1168.06

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See also your portfolio center. Please also try Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.