Correlation Between Ford and Mobly SA
Can any of the company-specific risk be diversified away by investing in both Ford and Mobly SA 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 Mobly SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Mobly SA, you can compare the effects of market volatilities on Ford and Mobly SA 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 Mobly SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Mobly SA.
Diversification Opportunities for Ford and Mobly SA
Good diversification
The 3 months correlation between Ford and Mobly is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Mobly SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobly SA 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 Mobly SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobly SA has no effect on the direction of Ford i.e., Ford and Mobly SA go up and down completely randomly.
Pair Corralation between Ford and Mobly SA
Taking into account the 90-day investment horizon Ford Motor is expected to generate 0.45 times more return on investment than Mobly SA. However, Ford Motor is 2.23 times less risky than Mobly SA. It trades about -0.18 of its potential returns per unit of risk. Mobly SA is currently generating about -0.34 per unit of risk. If you would invest 1,110 in Ford Motor on September 13, 2024 and sell it today you would lose (71.00) from holding Ford Motor or give up 6.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ford Motor vs. Mobly SA
Performance |
| Timeline |
| Ford Motor |
| Mobly SA |
Ford and Mobly SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Mobly SA
The main advantage of trading using opposite Ford and Mobly SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Mobly SA 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 Mobly SA will offset losses from the drop in Mobly SA's long position.The idea behind Ford Motor and Mobly SA 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.| Mobly SA vs. Enjoei SA | Mobly SA vs. Westwing Comrcio Varejista | Mobly SA vs. Intelbras SA | Mobly SA vs. Bemobi Mobile Tech |
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
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |