Correlation Between Bob Evans and Microsoft
Can any of the company-specific risk be diversified away by investing in both Bob Evans 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 Bob Evans and Microsoft into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bob Evans Farms and Microsoft, you can compare the effects of market volatilities on Bob Evans 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 Bob Evans with a short position of Microsoft. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bob Evans and Microsoft.
Diversification Opportunities for Bob Evans and Microsoft
Pay attention - limited upside
The 3 months correlation between Bob and Microsoft is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bob Evans Farms and Microsoft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microsoft and Bob Evans 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 Bob Evans Farms 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 Bob Evans i.e., Bob Evans and Microsoft go up and down completely randomly.
Pair Corralation between Bob Evans and Microsoft
If you would invest (100.00) in Bob Evans Farms on January 16, 2024 and sell it today you would earn a total of 100.00 from holding Bob Evans Farms or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Bob Evans Farms vs. Microsoft
Performance |
| Timeline |
| Bob Evans Farms |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Microsoft |
Bob Evans and Microsoft Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bob Evans and Microsoft
The main advantage of trading using opposite Bob Evans and Microsoft positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bob Evans 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.| Bob Evans vs. Flexible Solutions International | Bob Evans vs. Wizz Air Holdings | Bob Evans vs. Alaska Air Group | Bob Evans vs. Alto Ingredients |
| Microsoft vs. Cloudflare | Microsoft vs. Okta Inc | Microsoft vs. Adobe Systems Incorporated | Microsoft vs. Nutanix |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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