Correlation Between Ford and LOWES
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By analyzing existing cross correlation between Ford Motor and LOWES INC 665, you can compare the effects of market volatilities on Ford and LOWES 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 LOWES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and LOWES.
Diversification Opportunities for Ford and LOWES
Very good diversification
The 3 months correlation between Ford and LOWES is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and LOWES INC 665 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LOWES INC 665 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 LOWES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LOWES INC 665 has no effect on the direction of Ford i.e., Ford and LOWES go up and down completely randomly.
Pair Corralation between Ford and LOWES
Taking into account the 90-day investment horizon Ford Motor is expected to under-perform the LOWES. In addition to that, Ford is 1.63 times more volatile than LOWES INC 665. It trades about 0.0 of its total potential returns per unit of risk. LOWES INC 665 is currently generating about 0.02 per unit of volatility. If you would invest 10,892 in LOWES INC 665 on September 3, 2024 and sell it today you would earn a total of 132.00 from holding LOWES INC 665 or generate 1.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 82.4% |
| Values | Daily Returns |
Ford Motor vs. LOWES INC 665
Performance |
| Timeline |
| Ford Motor |
| LOWES INC 665 |
Ford and LOWES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and LOWES
The main advantage of trading using opposite Ford and LOWES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, LOWES 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 LOWES will offset losses from the drop in LOWES's long position.| Ford vs. GreenPower Motor | Ford vs. ZEEKR Intelligent Technology | Ford vs. Volcon Inc | Ford vs. Ford Motor |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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