Correlation Between Microsoft and Guggenheim Styleplus

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

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

Diversification Opportunities for Microsoft and Guggenheim Styleplus

0.0

Correlation Coefficient

Microsoft  Guggenheim Styleplus

Pay attention - limited upside

The 3 months correlation between Microsoft and Guggenheim is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Guggenheim Styleplus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim Styleplus 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 Guggenheim Styleplus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Styleplus has no effect on the direction of Microsoft i.e., Microsoft and Guggenheim Styleplus go up and down completely randomly.

Pair Corralation between Microsoft and Guggenheim Styleplus

If you would invest  43,537  in Microsoft on May 5, 2025 and sell it today you would earn a total of  8,874  from holding Microsoft or generate 20.38% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Microsoft  vs.  Guggenheim Styleplus

Microsoft

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Microsoft are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak technical and fundamental indicators, Microsoft unveiled solid returns over the last few months and may actually be approaching a breakup point.

Guggenheim Styleplus

Risk-Adjusted Performance

Very Weak

Over the last 90 days Guggenheim Styleplus has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Guggenheim Styleplus is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Microsoft and Guggenheim Styleplus

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

The idea behind Microsoft and Guggenheim Styleplus 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.