Correlation Between Ford and Altur Slatina
Can any of the company-specific risk be diversified away by investing in both Ford and Altur Slatina 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 Ford and Altur Slatina into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Altur Slatina, you can compare the effects of market volatilities on Ford and Altur Slatina 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 Altur Slatina. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Altur Slatina.
Diversification Opportunities for Ford and Altur Slatina
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ford and Altur is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Altur Slatina in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altur Slatina 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 Altur Slatina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altur Slatina has no effect on the direction of Ford i.e., Ford and Altur Slatina go up and down completely randomly.
Pair Corralation between Ford and Altur Slatina
Taking into account the 90-day investment horizon Ford Motor is expected to generate 0.81 times more return on investment than Altur Slatina. However, Ford Motor is 1.24 times less risky than Altur Slatina. It trades about 0.03 of its potential returns per unit of risk. Altur Slatina is currently generating about -0.01 per unit of risk. If you would invest 1,011 in Ford Motor on September 2, 2024 and sell it today you would earn a total of 102.00 from holding Ford Motor or generate 10.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.58% |
| Values | Daily Returns |
Ford Motor vs. Altur Slatina
Performance |
| Timeline |
| Ford Motor |
| Altur Slatina |
Ford and Altur Slatina Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Altur Slatina
The main advantage of trading using opposite Ford and Altur Slatina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Altur Slatina 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 Altur Slatina will offset losses from the drop in Altur Slatina's long position.The idea behind Ford Motor and Altur Slatina 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.| Altur Slatina vs. TRANSILVANIA INVESTMENTS ALLIANCE | Altur Slatina vs. Evergent Investments SA | Altur Slatina vs. Patria Bank SA | Altur Slatina vs. Biofarm Bucure |
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 Stocks Directory module to find actively traded stocks across global markets.
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