Correlation Between CrowdStrike Holdings, and Microsoft

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

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

Diversification Opportunities for CrowdStrike Holdings, and Microsoft

0.0

Correlation Coefficient

CrowdStrike Holdings,  Microsoft

Pay attention - limited upside

The 3 months correlation between CrowdStrike and Microsoft is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CrowdStrike Holdings, and Microsoft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microsoft and CrowdStrike Holdings, 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 CrowdStrike Holdings, 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 CrowdStrike Holdings, i.e., CrowdStrike Holdings, and Microsoft go up and down completely randomly.

Pair Corralation between CrowdStrike Holdings, and Microsoft

If you would invest  706,146  in Microsoft on April 20, 2025 and sell it today you would earn a total of  246,720  from holding Microsoft or generate 34.94% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

CrowdStrike Holdings,  vs.  Microsoft

CrowdStrike Holdings,

Risk-Adjusted Performance

Good

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

Microsoft

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Microsoft are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Microsoft showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CrowdStrike Holdings, and Microsoft

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

The idea behind CrowdStrike Holdings, and Microsoft 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.