Correlation Analysis Between Merck and Microsoft

This module allows you to analyze existing cross correlation between Merck Company and Microsoft Corporation. You can compare the effects of market volatilities on Merck 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 Merck with a short position of Microsoft. See also your portfolio center. Please also check ongoing floating volatility patterns of Merck and Microsoft.
Horizon     30 Days    Login   to change
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Comparative Performance


Risk-Adjusted Performance

Over the last 30 days Merck Company has generated negative risk-adjusted returns adding no value to investors with long positions. Regardless of fairly consistent technical and fundamental indicators, Merck is not utilizing all of its potentials. The existing stock price confusion, may contribute to short-horizon losses for the traders.

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Microsoft Corporation are ranked lower than 1 (%) of all global equities and portfolios over the last 30 days. In spite of comparatively unchanging essential indicators, Microsoft is not utilizing all of its potentials. The existing stock price uproar, may contribute to short horizon losses for the leadership.

Merck and Microsoft Volatility Contrast

 Predicted Return Density 

Merck Company Inc  vs.  Microsoft Corp.

 Performance (%) 

Pair Volatility

Considering 30-days investment horizon, Merck Company is expected to under-perform the Microsoft. In addition to that, Merck is 1.0 times more volatile than Microsoft Corporation. It trades about -0.02 of its total potential returns per unit of risk. Microsoft Corporation is currently generating about 0.02 per unit of volatility. If you would invest  13,602  in Microsoft Corporation on August 19, 2019 and sell it today you would earn a total of  137.00  from holding Microsoft Corporation or generate 1.01% return on investment over 30 days.

Pair Corralation between Merck and Microsoft

Time Period3 Months [change]
ValuesDaily Returns

Diversification Opportunities for Merck and Microsoft

Merck Company Inc diversification synergy

Poor diversification

Overlapping area represents the amount of risk that can be diversified away by holding Merck Company Inc and Microsoft Corp. in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Microsoft and Merck 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 Merck Company 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 Merck i.e. Merck and Microsoft go up and down completely randomly.
See also your portfolio center. Please also try Content Syndication module to quickly integrate customizable finance content to your own investment portal.