Correlation Analysis Between Red Hat and Microsoft

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

Red Hat Inc  vs.  Microsoft Corp.

 Performance (%) 

Pair Volatility

Considering 30-days investment horizon, Red Hat is expected to under-perform the Microsoft. In addition to that, Red Hat is 2.02 times more volatile than Microsoft Corporation. It trades about -0.1 of its total potential returns per unit of risk. Microsoft Corporation is currently generating about 0.19 per unit of volatility. If you would invest  10,960  in Microsoft Corporation on August 26, 2018 and sell it today you would earn a total of  507.00  from holding Microsoft Corporation or generate 4.63% return on investment over 30 days.

Pair Corralation between Red Hat and Microsoft

Time Period1 Month [change]
ValuesDaily Returns


Very good diversification

Overlapping area represents the amount of risk that can be diversified away by holding Red Hat Inc and Microsoft Corp. in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Microsoft and Red Hat 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 Red Hat 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 Red Hat i.e. Red Hat and Microsoft go up and down completely randomly.

Comparative Volatility

 Predicted Return Density 
Red Hat  

Risk-Adjusted Performance

Over the last 30 days Red Hat has generated negative risk-adjusted returns adding no value to investors with long positions.

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Microsoft Corporation are ranked lower than 12 (%) of all global equities and portfolios over the last 30 days.

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