Correlation Between TIANDE CHEMICAL and Microsoft

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

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

Diversification Opportunities for TIANDE CHEMICAL and Microsoft

0.0

Correlation Coefficient

TIANDE CHEMICAL  Microsoft

Pay attention - limited upside

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

Pair Corralation between TIANDE CHEMICAL and Microsoft

If you would invest  36,299  in Microsoft on March 23, 2025 and sell it today you would earn a total of  5,331  from holding Microsoft or generate 14.69% return on investment over 90 days.

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

TIANDE CHEMICAL  vs.  Microsoft

TIANDE CHEMICAL

Risk-Adjusted Performance

Very Weak

Over the last 90 days TIANDE CHEMICAL has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, TIANDE CHEMICAL is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Microsoft

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Microsoft are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady technical and fundamental indicators, Microsoft displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with TIANDE CHEMICAL and Microsoft

The main advantage of trading using opposite TIANDE CHEMICAL and Microsoft positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TIANDE CHEMICAL 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 TIANDE CHEMICAL 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 Stocks Directory module to find actively traded stocks across global markets.