Correlation Between Ford and Amplitech
Can any of the company-specific risk be diversified away by investing in both Ford and Amplitech 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 Amplitech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Amplitech Group, you can compare the effects of market volatilities on Ford and Amplitech 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 Amplitech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Amplitech.
Diversification Opportunities for Ford and Amplitech
Modest diversification
The 3 months correlation between Ford and Amplitech is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Amplitech Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplitech Group 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 Amplitech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplitech Group has no effect on the direction of Ford i.e., Ford and Amplitech go up and down completely randomly.
Pair Corralation between Ford and Amplitech
Taking into account the 90-day investment horizon Ford Motor is expected to under-perform the Amplitech. But the stock apears to be less risky and, when comparing its historical volatility, Ford Motor is 2.81 times less risky than Amplitech. The stock trades about 0.0 of its potential returns per unit of risk. The Amplitech Group is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 119.00 in Amplitech Group on September 2, 2024 and sell it today you would lose (25.00) from holding Amplitech Group or give up 21.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ford Motor vs. Amplitech Group
Performance |
| Timeline |
| Ford Motor |
| Amplitech Group |
Ford and Amplitech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Amplitech
The main advantage of trading using opposite Ford and Amplitech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Amplitech 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 Amplitech will offset losses from the drop in Amplitech's long position.The idea behind Ford Motor and Amplitech Group 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.| Amplitech vs. Knowles Cor | Amplitech vs. Ubiquiti Networks | Amplitech vs. AmpliTech Group | Amplitech vs. Viavi Solutions |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |