Correlation Between Ford and 031162DP2
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By analyzing existing cross correlation between Ford Motor and AMGN 515 02 MAR 28, you can compare the effects of market volatilities on Ford and 031162DP2 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 031162DP2. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and 031162DP2.
Diversification Opportunities for Ford and 031162DP2
Very good diversification
The 3 months correlation between Ford and 031162DP2 is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and AMGN 515 02 MAR 28 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMGN 515 02 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 031162DP2. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMGN 515 02 has no effect on the direction of Ford i.e., Ford and 031162DP2 go up and down completely randomly.
Pair Corralation between Ford and 031162DP2
Taking into account the 90-day investment horizon Ford Motor is expected to generate 3.52 times more return on investment than 031162DP2. However, Ford is 3.52 times more volatile than AMGN 515 02 MAR 28. It trades about 0.23 of its potential returns per unit of risk. AMGN 515 02 MAR 28 is currently generating about -0.19 per unit of risk. If you would invest 1,015 in Ford Motor on September 1, 2024 and sell it today you would earn a total of 98.00 from holding Ford Motor or generate 9.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ford Motor vs. AMGN 515 02 MAR 28
Performance |
| Timeline |
| Ford Motor |
| AMGN 515 02 |
Ford and 031162DP2 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and 031162DP2
The main advantage of trading using opposite Ford and 031162DP2 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, 031162DP2 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 031162DP2 will offset losses from the drop in 031162DP2's long position.The idea behind Ford Motor and AMGN 515 02 MAR 28 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.| 031162DP2 vs. National Beverage Corp | 031162DP2 vs. Ambev SA ADR | 031162DP2 vs. SkyWest | 031162DP2 vs. Boston Beer |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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