Correlation Between Ford and ZEEKR Intelligent
Can any of the company-specific risk be diversified away by investing in both Ford and ZEEKR Intelligent at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Ford and ZEEKR Intelligent into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and ZEEKR Intelligent Technology, you can compare the effects of market volatilities on Ford and ZEEKR Intelligent 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 ZEEKR Intelligent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and ZEEKR Intelligent.
Diversification Opportunities for Ford and ZEEKR Intelligent
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ford and ZEEKR is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and ZEEKR Intelligent Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZEEKR Intelligent 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 ZEEKR Intelligent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZEEKR Intelligent has no effect on the direction of Ford i.e., Ford and ZEEKR Intelligent go up and down completely randomly.
Pair Corralation between Ford and ZEEKR Intelligent
Taking into account the 90-day investment horizon Ford Motor is expected to generate 0.34 times more return on investment than ZEEKR Intelligent. However, Ford Motor is 2.97 times less risky than ZEEKR Intelligent. It trades about 0.01 of its potential returns per unit of risk. ZEEKR Intelligent Technology is currently generating about -0.11 per unit of risk. If you would invest 1,122 in Ford Motor on August 27, 2024 and sell it today you would lose (4.00) from holding Ford Motor or give up 0.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ford Motor vs. ZEEKR Intelligent Technology
Performance |
| Timeline |
| Ford Motor |
| ZEEKR Intelligent |
Ford and ZEEKR Intelligent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and ZEEKR Intelligent
The main advantage of trading using opposite Ford and ZEEKR Intelligent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, ZEEKR Intelligent 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 ZEEKR Intelligent will offset losses from the drop in ZEEKR Intelligent's long position.The idea behind Ford Motor and ZEEKR Intelligent Technology 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.| ZEEKR Intelligent vs. Rumble Inc | ZEEKR Intelligent vs. Xponential Fitness | ZEEKR Intelligent vs. Nextplat Corp | ZEEKR Intelligent vs. SunLink Health Systems |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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