Correlation Between Ford and Train Alliance
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By analyzing existing cross correlation between Ford Motor and Train Alliance Sweden, you can compare the effects of market volatilities on Ford and Train Alliance 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 Train Alliance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Train Alliance.
Diversification Opportunities for Ford and Train Alliance
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ford and Train is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Train Alliance Sweden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Train Alliance Sweden 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 Train Alliance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Train Alliance Sweden has no effect on the direction of Ford i.e., Ford and Train Alliance go up and down completely randomly.
Pair Corralation between Ford and Train Alliance
Taking into account the 90-day investment horizon Ford Motor is expected to generate 2.27 times more return on investment than Train Alliance. However, Ford is 2.27 times more volatile than Train Alliance Sweden. It trades about 0.0 of its potential returns per unit of risk. Train Alliance Sweden is currently generating about -0.38 per unit of risk. If you would invest 1,122 in Ford Motor on August 29, 2024 and sell it today you would lose (12.00) from holding Ford Motor or give up 1.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ford Motor vs. Train Alliance Sweden
Performance |
| Timeline |
| Ford Motor |
| Train Alliance Sweden |
Ford and Train Alliance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Train Alliance
The main advantage of trading using opposite Ford and Train Alliance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Train Alliance 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 Train Alliance will offset losses from the drop in Train Alliance's long position.The idea behind Ford Motor and Train Alliance Sweden 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.| Train Alliance vs. Bergman Beving AB | Train Alliance vs. FM Mattsson Mora | Train Alliance vs. Systemair AB | Train Alliance vs. Rejlers AB |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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