Correlation Between Ford and Satrix MSCI
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By analyzing existing cross correlation between Ford Motor and Satrix MSCI World, you can compare the effects of market volatilities on Ford and Satrix MSCI 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 Satrix MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Satrix MSCI.
Diversification Opportunities for Ford and Satrix MSCI
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ford and Satrix is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Satrix MSCI World in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Satrix MSCI World 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 Satrix MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Satrix MSCI World has no effect on the direction of Ford i.e., Ford and Satrix MSCI go up and down completely randomly.
Pair Corralation between Ford and Satrix MSCI
Taking into account the 90-day investment horizon Ford is expected to generate 2.44 times less return on investment than Satrix MSCI. In addition to that, Ford is 2.44 times more volatile than Satrix MSCI World. It trades about 0.01 of its total potential returns per unit of risk. Satrix MSCI World is currently generating about 0.09 per unit of volatility. If you would invest 736,800 in Satrix MSCI World on August 31, 2024 and sell it today you would earn a total of 257,100 from holding Satrix MSCI World or generate 34.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.75% |
| Values | Daily Returns |
Ford Motor vs. Satrix MSCI World
Performance |
| Timeline |
| Ford Motor |
| Satrix MSCI World |
Ford and Satrix MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Satrix MSCI
The main advantage of trading using opposite Ford and Satrix MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Satrix MSCI 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 Satrix MSCI will offset losses from the drop in Satrix MSCI's long position.The idea behind Ford Motor and Satrix MSCI World 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.| Satrix MSCI vs. Satrix Swix Top | Satrix MSCI vs. Satrix 40 ETF | Satrix MSCI vs. Satrix MSCI EM | Satrix MSCI vs. Satrix Resi ETF |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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