Correlation Between Ford and MASTEC
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By analyzing existing cross correlation between Ford Motor and MASTEC INC 45, you can compare the effects of market volatilities on Ford and MASTEC 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 MASTEC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and MASTEC.
Diversification Opportunities for Ford and MASTEC
Very good diversification
The 3 months correlation between Ford and MASTEC is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and MASTEC INC 45 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MASTEC INC 45 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 MASTEC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MASTEC INC 45 has no effect on the direction of Ford i.e., Ford and MASTEC go up and down completely randomly.
Pair Corralation between Ford and MASTEC
Taking into account the 90-day investment horizon Ford Motor is expected to generate 2.71 times more return on investment than MASTEC. However, Ford is 2.71 times more volatile than MASTEC INC 45. It trades about 0.04 of its potential returns per unit of risk. MASTEC INC 45 is currently generating about -0.23 per unit of risk. If you would invest 1,122 in Ford Motor on August 27, 2024 and sell it today you would earn a total of 18.00 from holding Ford Motor or generate 1.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 85.71% |
| Values | Daily Returns |
Ford Motor vs. MASTEC INC 45
Performance |
| Timeline |
| Ford Motor |
| MASTEC INC 45 |
Ford and MASTEC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and MASTEC
The main advantage of trading using opposite Ford and MASTEC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, MASTEC 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 MASTEC will offset losses from the drop in MASTEC's long position.The idea behind Ford Motor and MASTEC INC 45 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.| MASTEC vs. The Coca Cola | MASTEC vs. JPMorgan Chase Co | MASTEC vs. Dupont De Nemours | MASTEC vs. Alcoa Corp |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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