Correlation Between Ford and Meredith
Can any of the company-specific risk be diversified away by investing in both Ford and Meredith 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 Meredith into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Meredith, you can compare the effects of market volatilities on Ford and Meredith 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 Meredith. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Meredith.
Diversification Opportunities for Ford and Meredith
Pay attention - limited upside
The 3 months correlation between Ford and Meredith is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Meredith in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meredith 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 Meredith. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meredith has no effect on the direction of Ford i.e., Ford and Meredith go up and down completely randomly.
Pair Corralation between Ford and Meredith
If you would invest 1,033 in Ford Motor on August 31, 2024 and sell it today you would earn a total of 77.00 from holding Ford Motor or generate 7.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Ford Motor vs. Meredith
Performance |
| Timeline |
| Ford Motor |
| Meredith |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ford and Meredith Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Meredith
The main advantage of trading using opposite Ford and Meredith positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Meredith 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 Meredith will offset losses from the drop in Meredith's long position.The idea behind Ford Motor and Meredith 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.| Meredith vs. Cimpress NV | Meredith vs. QuinStreet | Meredith vs. Criteo Sa | Meredith vs. Interpublic Group of |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |