Correlation Between Ford and Peak Bancorp
Can any of the company-specific risk be diversified away by investing in both Ford and Peak Bancorp 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 Peak Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Peak Bancorp, you can compare the effects of market volatilities on Ford and Peak Bancorp 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 Peak Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Peak Bancorp.
Diversification Opportunities for Ford and Peak Bancorp
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ford and Peak is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Peak Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peak Bancorp 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 Peak Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peak Bancorp has no effect on the direction of Ford i.e., Ford and Peak Bancorp go up and down completely randomly.
Pair Corralation between Ford and Peak Bancorp
If you would invest 940.00 in Peak Bancorp on September 13, 2024 and sell it today you would earn a total of 0.00 from holding Peak Bancorp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Ford Motor vs. Peak Bancorp
Performance |
| Timeline |
| Ford Motor |
| Peak Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ford and Peak Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Peak Bancorp
The main advantage of trading using opposite Ford and Peak Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Peak Bancorp 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 Peak Bancorp will offset losses from the drop in Peak Bancorp's long position.The idea behind Ford Motor and Peak Bancorp 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.| Peak Bancorp vs. MVB Financial Corp | Peak Bancorp vs. Finward Bancorp | Peak Bancorp vs. First Community | Peak Bancorp vs. LINKBANCORP |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |