Correlation Between Ford and Kelly Strategic
Can any of the company-specific risk be diversified away by investing in both Ford and Kelly Strategic 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 Kelly Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Kelly Strategic Management, you can compare the effects of market volatilities on Ford and Kelly Strategic 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 Kelly Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Kelly Strategic.
Diversification Opportunities for Ford and Kelly Strategic
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ford and Kelly is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Kelly Strategic Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kelly Strategic Mana 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 Kelly Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kelly Strategic Mana has no effect on the direction of Ford i.e., Ford and Kelly Strategic go up and down completely randomly.
Pair Corralation between Ford and Kelly Strategic
Taking into account the 90-day investment horizon Ford is expected to generate 3.68 times less return on investment than Kelly Strategic. In addition to that, Ford is 1.7 times more volatile than Kelly Strategic Management. It trades about 0.01 of its total potential returns per unit of risk. Kelly Strategic Management is currently generating about 0.05 per unit of volatility. If you would invest 1,034 in Kelly Strategic Management on September 3, 2024 and sell it today you would earn a total of 95.00 from holding Kelly Strategic Management or generate 9.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 30.91% |
| Values | Daily Returns |
Ford Motor vs. Kelly Strategic Management
Performance |
| Timeline |
| Ford Motor |
| Kelly Strategic Mana |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ford and Kelly Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Kelly Strategic
The main advantage of trading using opposite Ford and Kelly Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Kelly Strategic 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 Kelly Strategic will offset losses from the drop in Kelly Strategic'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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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