Correlation Between Ford and Polen International
Can any of the company-specific risk be diversified away by investing in both Ford and Polen International 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 Polen International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Polen International Small, you can compare the effects of market volatilities on Ford and Polen International 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 Polen International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Polen International.
Diversification Opportunities for Ford and Polen International
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ford and Polen is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Polen International Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polen International Small 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 Polen International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polen International Small has no effect on the direction of Ford i.e., Ford and Polen International go up and down completely randomly.
Pair Corralation between Ford and Polen International
If you would invest 1,016 in Polen International Small on September 3, 2024 and sell it today you would earn a total of 0.00 from holding Polen International Small or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.8% |
| Values | Daily Returns |
Ford Motor vs. Polen International Small
Performance |
| Timeline |
| Ford Motor |
| Polen International Small |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ford and Polen International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Polen International
The main advantage of trading using opposite Ford and Polen International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Polen International 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 Polen International will offset losses from the drop in Polen International's long position.| Ford vs. GreenPower Motor | Ford vs. ZEEKR Intelligent Technology | Ford vs. Volcon Inc | Ford vs. Ford Motor |
| Polen International vs. Polen International Growth | Polen International vs. Polen Bank Loan | Polen International vs. Polen Smid | Polen International vs. Polen Small Pany |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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