Correlation Between Ford and Yes Optoelectronics
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By analyzing existing cross correlation between Ford Motor and Yes Optoelectronics Co, you can compare the effects of market volatilities on Ford and Yes Optoelectronics 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 Ford with a short position of Yes Optoelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Yes Optoelectronics.
Diversification Opportunities for Ford and Yes Optoelectronics
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ford and Yes is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Yes Optoelectronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yes Optoelectronics and Ford 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 Ford Motor are associated (or correlated) with Yes Optoelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yes Optoelectronics has no effect on the direction of Ford i.e., Ford and Yes Optoelectronics go up and down completely randomly.
Pair Corralation between Ford and Yes Optoelectronics
Taking into account the 90-day investment horizon Ford Motor is expected to generate 0.24 times more return on investment than Yes Optoelectronics. However, Ford Motor is 4.09 times less risky than Yes Optoelectronics. It trades about -0.14 of its potential returns per unit of risk. Yes Optoelectronics Co is currently generating about -0.21 per unit of risk. If you would invest 999.00 in Ford Motor on October 15, 2024 and sell it today you would lose (34.00) from holding Ford Motor or give up 3.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.0% |
| Values | Daily Returns |
Ford Motor vs. Yes Optoelectronics Co
Performance |
| Timeline |
| Ford Motor |
| Yes Optoelectronics |
Ford and Yes Optoelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Yes Optoelectronics
The main advantage of trading using opposite Ford and Yes Optoelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Yes Optoelectronics 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 Yes Optoelectronics will offset losses from the drop in Yes Optoelectronics' long position.The idea behind Ford Motor and Yes Optoelectronics Co 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.| Yes Optoelectronics vs. Sihui Fuji Electronics | Yes Optoelectronics vs. Shengda Mining Co | Yes Optoelectronics vs. Hainan Mining Co | Yes Optoelectronics vs. Integrated Electronic Systems |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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