Correlation Between Ford and DWS
Can any of the company-specific risk be diversified away by investing in both Ford and DWS 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 DWS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and DWS, you can compare the effects of market volatilities on Ford and DWS 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 DWS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and DWS.
Diversification Opportunities for Ford and DWS
Pay attention - limited upside
The 3 months correlation between Ford and DWS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and DWS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DWS 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 DWS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DWS has no effect on the direction of Ford i.e., Ford and DWS go up and down completely randomly.
Pair Corralation between Ford and DWS
If you would invest 1,148 in Ford Motor on September 3, 2024 and sell it today you would lose (35.00) from holding Ford Motor or give up 3.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Ford Motor vs. DWS
Performance |
| Timeline |
| Ford Motor |
| DWS |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ford and DWS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and DWS
The main advantage of trading using opposite Ford and DWS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, DWS 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 DWS will offset losses from the drop in DWS's long position.| Ford vs. GreenPower Motor | Ford vs. ZEEKR Intelligent Technology | Ford vs. Volcon Inc | Ford vs. Ford Motor |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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