Correlation Analysis Between Microsoft and XU100

This module allows you to analyze existing cross correlation between Microsoft Corporation and XU100. You can compare the effects of market volatilities on Microsoft and XU100 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 XU100. See also your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and XU100.
Horizon     30 Days    Login   to change
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Comparative Performance

 Predicted Return Density 
      Returns 

Microsoft Corp.  vs.  XU100

 Performance (%) 
      Timeline 

Pair Volatility

Given the investment horizon of 30 days, Microsoft Corporation is expected to generate 0.56 times more return on investment than XU100. However, Microsoft Corporation is 1.79 times less risky than XU100. It trades about 0.14 of its potential returns per unit of risk. XU100 is currently generating about 0.04 per unit of risk. If you would invest  13,368  in Microsoft Corporation on October 14, 2019 and sell it today you would earn a total of  1,363  from holding Microsoft Corporation or generate 10.2% return on investment over 30 days.

Pair Corralation between Microsoft and XU100

-0.62
Time Period3 Months [change]
DirectionNegative 
StrengthWeak
Accuracy96.88%
ValuesDaily Returns

Diversification Opportunities for Microsoft and XU100

Microsoft Corp. diversification synergy

Excellent diversification

Overlapping area represents the amount of risk that can be diversified away by holding Microsoft Corp. and XU100 in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on XU100 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 XU100. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XU100 has no effect on the direction of Microsoft i.e. Microsoft and XU100 go up and down completely randomly.
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