Correlation Between Ford and KEYBANK
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By analyzing existing cross correlation between Ford Motor and KEYBANK NATL ASSN, you can compare the effects of market volatilities on Ford and KEYBANK 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 KEYBANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and KEYBANK.
Diversification Opportunities for Ford and KEYBANK
Weak diversification
The 3 months correlation between Ford and KEYBANK is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and KEYBANK NATL ASSN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KEYBANK NATL ASSN 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 KEYBANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KEYBANK NATL ASSN has no effect on the direction of Ford i.e., Ford and KEYBANK go up and down completely randomly.
Pair Corralation between Ford and KEYBANK
Taking into account the 90-day investment horizon Ford Motor is expected to generate 5.34 times more return on investment than KEYBANK. However, Ford is 5.34 times more volatile than KEYBANK NATL ASSN. It trades about 0.01 of its potential returns per unit of risk. KEYBANK NATL ASSN is currently generating about -0.14 per unit of risk. If you would invest 1,104 in Ford Motor on August 30, 2024 and sell it today you would earn a total of 6.00 from holding Ford Motor or generate 0.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 45.31% |
| Values | Daily Returns |
Ford Motor vs. KEYBANK NATL ASSN
Performance |
| Timeline |
| Ford Motor |
| KEYBANK NATL ASSN |
Ford and KEYBANK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and KEYBANK
The main advantage of trading using opposite Ford and KEYBANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, KEYBANK 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 KEYBANK will offset losses from the drop in KEYBANK's long position.The idea behind Ford Motor and KEYBANK NATL ASSN 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.| KEYBANK vs. Meli Hotels International | KEYBANK vs. Planet Fitness | KEYBANK vs. Marine Products | KEYBANK vs. Playtech plc |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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