Correlation Between Ford and LandisGyr Group
Can any of the company-specific risk be diversified away by investing in both Ford and LandisGyr Group 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 LandisGyr Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and LandisGyr Group AG, you can compare the effects of market volatilities on Ford and LandisGyr Group 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 LandisGyr Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and LandisGyr Group.
Diversification Opportunities for Ford and LandisGyr Group
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ford and LandisGyr is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and LandisGyr Group AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LandisGyr Group AG 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 LandisGyr Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LandisGyr Group AG has no effect on the direction of Ford i.e., Ford and LandisGyr Group go up and down completely randomly.
Pair Corralation between Ford and LandisGyr Group
Taking into account the 90-day investment horizon Ford Motor is expected to generate 1.61 times more return on investment than LandisGyr Group. However, Ford is 1.61 times more volatile than LandisGyr Group AG. It trades about 0.0 of its potential returns per unit of risk. LandisGyr Group AG is currently generating about -0.06 per unit of risk. If you would invest 1,173 in Ford Motor on September 3, 2024 and sell it today you would lose (60.00) from holding Ford Motor or give up 5.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.66% |
| Values | Daily Returns |
Ford Motor vs. LandisGyr Group AG
Performance |
| Timeline |
| Ford Motor |
| LandisGyr Group AG |
Ford and LandisGyr Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and LandisGyr Group
The main advantage of trading using opposite Ford and LandisGyr Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, LandisGyr Group 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 LandisGyr Group will offset losses from the drop in LandisGyr Group's long position.| Ford vs. GreenPower Motor | Ford vs. ZEEKR Intelligent Technology | Ford vs. Volcon Inc | Ford vs. Ford Motor |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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