Correlation Between Ford and Petrobras
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By analyzing existing cross correlation between Ford Motor and Petrobras 7375 percent, you can compare the effects of market volatilities on Ford and Petrobras 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 Petrobras. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Petrobras.
Diversification Opportunities for Ford and Petrobras
Good diversification
The 3 months correlation between Ford and Petrobras is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Petrobras 7375 percent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Petrobras 7375 percent 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 Petrobras. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Petrobras 7375 percent has no effect on the direction of Ford i.e., Ford and Petrobras go up and down completely randomly.
Pair Corralation between Ford and Petrobras
Taking into account the 90-day investment horizon Ford Motor is expected to generate 2.42 times more return on investment than Petrobras. However, Ford is 2.42 times more volatile than Petrobras 7375 percent. It trades about 0.01 of its potential returns per unit of risk. Petrobras 7375 percent is currently generating about 0.0 per unit of risk. If you would invest 1,148 in Ford Motor on September 3, 2024 and sell it today you would lose (35.00) from holding Ford Motor or give up 3.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.58% |
| Values | Daily Returns |
Ford Motor vs. Petrobras 7375 percent
Performance |
| Timeline |
| Ford Motor |
| Petrobras 7375 percent |
Ford and Petrobras Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Petrobras
The main advantage of trading using opposite Ford and Petrobras positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Petrobras 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 Petrobras will offset losses from the drop in Petrobras' long position.The idea behind Ford Motor and Petrobras 7375 percent 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.| Petrobras vs. Sonos Inc | Petrobras vs. Starbucks | Petrobras vs. Life Time Group | Petrobras vs. The Cheesecake Factory |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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