Correlation Between Ford and GOODYEAR
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By analyzing existing cross correlation between Ford Motor and GOODYEAR TIRE RUBR, you can compare the effects of market volatilities on Ford and GOODYEAR 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 GOODYEAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and GOODYEAR.
Diversification Opportunities for Ford and GOODYEAR
Very good diversification
The 3 months correlation between Ford and GOODYEAR is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and GOODYEAR TIRE RUBR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GOODYEAR TIRE RUBR 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 GOODYEAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GOODYEAR TIRE RUBR has no effect on the direction of Ford i.e., Ford and GOODYEAR go up and down completely randomly.
Pair Corralation between Ford and GOODYEAR
Taking into account the 90-day investment horizon Ford Motor is expected to under-perform the GOODYEAR. In addition to that, Ford is 1.96 times more volatile than GOODYEAR TIRE RUBR. It trades about -0.01 of its total potential returns per unit of risk. GOODYEAR TIRE RUBR is currently generating about 0.01 per unit of volatility. If you would invest 10,264 in GOODYEAR TIRE RUBR on September 3, 2024 and sell it today you would lose (14.00) from holding GOODYEAR TIRE RUBR or give up 0.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.89% |
| Values | Daily Returns |
Ford Motor vs. GOODYEAR TIRE RUBR
Performance |
| Timeline |
| Ford Motor |
| GOODYEAR TIRE RUBR |
Ford and GOODYEAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and GOODYEAR
The main advantage of trading using opposite Ford and GOODYEAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, GOODYEAR 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 GOODYEAR will offset losses from the drop in GOODYEAR's long position.| Ford vs. GreenPower Motor | Ford vs. ZEEKR Intelligent Technology | Ford vs. Volcon Inc | Ford vs. Ford Motor |
| GOODYEAR vs. Western Asset Investment | GOODYEAR vs. Allient | GOODYEAR vs. FARO Technologies | GOODYEAR vs. Radcom |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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