Correlation Between Microsoft and Crescent Capital
Can any of the company-specific risk be diversified away by investing in both Microsoft and Crescent Capital 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 Crescent Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microsoft and Crescent Capital BDC, you can compare the effects of market volatilities on Microsoft and Crescent Capital 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 Crescent Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microsoft and Crescent Capital.
Diversification Opportunities for Microsoft and Crescent Capital
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Microsoft and Crescent is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Microsoft and Crescent Capital BDC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crescent Capital BDC 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 Crescent Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crescent Capital BDC has no effect on the direction of Microsoft i.e., Microsoft and Crescent Capital go up and down completely randomly.
Pair Corralation between Microsoft and Crescent Capital
Given the investment horizon of 90 days Microsoft is expected to generate 0.84 times more return on investment than Crescent Capital. However, Microsoft is 1.19 times less risky than Crescent Capital. It trades about 0.03 of its potential returns per unit of risk. Crescent Capital BDC is currently generating about -0.02 per unit of risk. If you would invest 51,287 in Microsoft on July 25, 2025 and sell it today you would earn a total of 767.00 from holding Microsoft or generate 1.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microsoft vs. Crescent Capital BDC
Performance |
| Timeline |
| Microsoft |
| Crescent Capital BDC |
Microsoft and Crescent Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microsoft and Crescent Capital
The main advantage of trading using opposite Microsoft and Crescent Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microsoft position performs unexpectedly, Crescent Capital 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 Crescent Capital will offset losses from the drop in Crescent Capital's long position.| Microsoft vs. Apple Inc | Microsoft vs. NVIDIA | Microsoft vs. Alphabet Inc Class A | Microsoft vs. FatPipe, Common Stock |
| Crescent Capital vs. Gladstone Investment | Crescent Capital vs. Eagle Point Credit | Crescent Capital vs. MSCome Fund, | Crescent Capital vs. PennantPark 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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |