Correlation Between Ford and BPCEGP
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By analyzing existing cross correlation between Ford Motor and BPCEGP 1 20 JAN 26, you can compare the effects of market volatilities on Ford and BPCEGP 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 BPCEGP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and BPCEGP.
Diversification Opportunities for Ford and BPCEGP
Significant diversification
The 3 months correlation between Ford and BPCEGP is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and BPCEGP 1 20 JAN 26 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BPCEGP 1 20 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 BPCEGP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BPCEGP 1 20 has no effect on the direction of Ford i.e., Ford and BPCEGP go up and down completely randomly.
Pair Corralation between Ford and BPCEGP
Taking into account the 90-day investment horizon Ford Motor is expected to under-perform the BPCEGP. But the stock apears to be less risky and, when comparing its historical volatility, Ford Motor is 3.33 times less risky than BPCEGP. The stock trades about -0.06 of its potential returns per unit of risk. The BPCEGP 1 20 JAN 26 is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 9,668 in BPCEGP 1 20 JAN 26 on November 29, 2024 and sell it today you would lose (55.00) from holding BPCEGP 1 20 JAN 26 or give up 0.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 23.81% |
| Values | Daily Returns |
Ford Motor vs. BPCEGP 1 20 JAN 26
Performance |
| Timeline |
| Ford Motor |
| BPCEGP 1 20 |
Ford and BPCEGP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and BPCEGP
The main advantage of trading using opposite Ford and BPCEGP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, BPCEGP 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 BPCEGP will offset losses from the drop in BPCEGP's long position.The idea behind Ford Motor and BPCEGP 1 20 JAN 26 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.| BPCEGP vs. Aegon NV ADR | BPCEGP vs. Old Republic International | BPCEGP vs. Robix Environmental Technologies | BPCEGP vs. Two Harbors Investments |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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