Correlation Between Ford and Kimteks Poliuretan
Can any of the company-specific risk be diversified away by investing in both Ford and Kimteks Poliuretan 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 Kimteks Poliuretan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Kimteks Poliuretan Sanayi, you can compare the effects of market volatilities on Ford and Kimteks Poliuretan 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 Kimteks Poliuretan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Kimteks Poliuretan.
Diversification Opportunities for Ford and Kimteks Poliuretan
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ford and Kimteks is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Kimteks Poliuretan Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kimteks Poliuretan Sanayi 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 Kimteks Poliuretan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kimteks Poliuretan Sanayi has no effect on the direction of Ford i.e., Ford and Kimteks Poliuretan go up and down completely randomly.
Pair Corralation between Ford and Kimteks Poliuretan
Taking into account the 90-day investment horizon Ford Motor is expected to generate 0.85 times more return on investment than Kimteks Poliuretan. However, Ford Motor is 1.18 times less risky than Kimteks Poliuretan. It trades about -0.02 of its potential returns per unit of risk. Kimteks Poliuretan Sanayi is currently generating about -0.08 per unit of risk. If you would invest 1,083 in Ford Motor on November 2, 2024 and sell it today you would lose (67.00) from holding Ford Motor or give up 6.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.17% |
| Values | Daily Returns |
Ford Motor vs. Kimteks Poliuretan Sanayi
Performance |
| Timeline |
| Ford Motor |
| Kimteks Poliuretan Sanayi |
Ford and Kimteks Poliuretan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Kimteks Poliuretan
The main advantage of trading using opposite Ford and Kimteks Poliuretan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Kimteks Poliuretan 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 Kimteks Poliuretan will offset losses from the drop in Kimteks Poliuretan's long position.The idea behind Ford Motor and Kimteks Poliuretan Sanayi 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.| Kimteks Poliuretan vs. Gentas Genel Metal | Kimteks Poliuretan vs. E Data Teknoloji Pazarlama | Kimteks Poliuretan vs. Politeknik Metal Sanayi | Kimteks Poliuretan vs. Sodas Sodyum Sanayi |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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