Correlation Between Ford and NEWMONT
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By analyzing existing cross correlation between Ford Motor and NEWMONT MNG P, you can compare the effects of market volatilities on Ford and NEWMONT 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 NEWMONT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and NEWMONT.
Diversification Opportunities for Ford and NEWMONT
Very good diversification
The 3 months correlation between Ford and NEWMONT is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and NEWMONT MNG P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEWMONT MNG P 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 NEWMONT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEWMONT MNG P has no effect on the direction of Ford i.e., Ford and NEWMONT go up and down completely randomly.
Pair Corralation between Ford and NEWMONT
Taking into account the 90-day investment horizon Ford is expected to generate 95.1 times less return on investment than NEWMONT. But when comparing it to its historical volatility, Ford Motor is 21.32 times less risky than NEWMONT. It trades about 0.01 of its potential returns per unit of risk. NEWMONT MNG P is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 10,897 in NEWMONT MNG P on September 2, 2024 and sell it today you would lose (187.00) from holding NEWMONT MNG P or give up 1.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 84.88% |
| Values | Daily Returns |
Ford Motor vs. NEWMONT MNG P
Performance |
| Timeline |
| Ford Motor |
| NEWMONT MNG P |
Ford and NEWMONT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and NEWMONT
The main advantage of trading using opposite Ford and NEWMONT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, NEWMONT 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 NEWMONT will offset losses from the drop in NEWMONT's long position.The idea behind Ford Motor and NEWMONT MNG P 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.| NEWMONT vs. AEP TEX INC | NEWMONT vs. US BANK NATIONAL | NEWMONT vs. Netflix | NEWMONT vs. Empire State Realty |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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