Correlation Between Microsoft and CYIOS

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

By analyzing existing cross correlation between Microsoft and CYIOS, you can compare the effects of market volatilities on Microsoft and CYIOS 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 CYIOS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and CYIOS.

Diversification Opportunities for Microsoft and CYIOS

-0.64

Correlation Coefficient

Microsoft  CYIOS

Excellent diversification

The 3 months correlation between Microsoft and CYIOS is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and CYIOS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CYIOS 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 are associated (or correlated) with CYIOS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CYIOS has no effect on the direction of Microsoft i.e., Microsoft and CYIOS go up and down completely randomly.

Pair Corralation between Microsoft and CYIOS

Given the investment horizon of 90 days Microsoft is expected to generate 0.12 times more return on investment than CYIOS. However, Microsoft is 8.59 times less risky than CYIOS. It trades about 0.17 of its potential returns per unit of risk. CYIOS is currently generating about -0.04 per unit of risk. If you would invest  45,993  in Microsoft on May 25, 2025 and sell it today you would earn a total of  4,730  from holding Microsoft or generate 10.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Microsoft  vs.  CYIOS

Microsoft

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Microsoft are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak technical and fundamental indicators, Microsoft may actually be approaching a critical reversion point that can send shares even higher in September 2025.

CYIOS

Risk-Adjusted Performance

Weakest

Over the last 90 days CYIOS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's forward indicators remain very healthy which may send shares a bit higher in September 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Microsoft and CYIOS

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

The idea behind Microsoft and CYIOS 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.

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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.