Correlation Between FactSet Research and MicroStrategy Incorporated

Can any of the company-specific risk be diversified away by investing in both FactSet Research and MicroStrategy Incorporated 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 FactSet Research and MicroStrategy Incorporated into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FactSet Research Systems and MicroStrategy Incorporated 1000, you can compare the effects of market volatilities on FactSet Research and MicroStrategy Incorporated 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 FactSet Research with a short position of MicroStrategy Incorporated. Check out your portfolio center. Please also check ongoing floating volatility patterns of FactSet Research and MicroStrategy Incorporated.

Diversification Opportunities for FactSet Research and MicroStrategy Incorporated

-0.37

Correlation Coefficient

FactSet Research  MicroStrategy Incorporated

Very good diversification

The 3 months correlation between FactSet and MicroStrategy is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding FactSet Research Systems and MicroStrategy Incorporated 100 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MicroStrategy Incorporated and FactSet Research 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 FactSet Research Systems are associated (or correlated) with MicroStrategy Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MicroStrategy Incorporated has no effect on the direction of FactSet Research i.e., FactSet Research and MicroStrategy Incorporated go up and down completely randomly.

Pair Corralation between FactSet Research and MicroStrategy Incorporated

Considering the 90-day investment horizon FactSet Research Systems is expected to under-perform the MicroStrategy Incorporated. But the stock apears to be less risky and, when comparing its historical volatility, FactSet Research Systems is 1.46 times less risky than MicroStrategy Incorporated. The stock trades about -0.21 of its potential returns per unit of risk. The MicroStrategy Incorporated 1000 is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  9,895  in MicroStrategy Incorporated 1000 on May 28, 2025 and sell it today you would earn a total of  1,230  from holding MicroStrategy Incorporated 1000 or generate 12.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

FactSet Research Systems  vs.  MicroStrategy Incorporated 100

FactSet Research Systems

Risk-Adjusted Performance

Weakest

Over the last 90 days FactSet Research Systems has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain comparatively stable which may send shares a bit higher in September 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

MicroStrategy Incorporated

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in MicroStrategy Incorporated 1000 are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent basic indicators, MicroStrategy Incorporated reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with FactSet Research and MicroStrategy Incorporated

The main advantage of trading using opposite FactSet Research and MicroStrategy Incorporated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FactSet Research position performs unexpectedly, MicroStrategy Incorporated 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 MicroStrategy Incorporated will offset losses from the drop in MicroStrategy Incorporated's long position.

The idea behind FactSet Research Systems and MicroStrategy Incorporated 1000 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.