Correlation Between Blue Bird and Fiat Chrysler
Can any of the company-specific risk be diversified away by investing in both Blue Bird and Fiat Chrysler 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 Blue Bird and Fiat Chrysler into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue Bird Corp and Fiat Chrysler Automobiles, you can compare the effects of market volatilities on Blue Bird and Fiat Chrysler 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 Blue Bird with a short position of Fiat Chrysler. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Bird and Fiat Chrysler.
Diversification Opportunities for Blue Bird and Fiat Chrysler
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Blue and Fiat is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Blue Bird Corp and Fiat Chrysler Automobiles in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fiat Chrysler Automobiles and Blue Bird 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 Blue Bird Corp are associated (or correlated) with Fiat Chrysler. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fiat Chrysler Automobiles has no effect on the direction of Blue Bird i.e., Blue Bird and Fiat Chrysler go up and down completely randomly.
Pair Corralation between Blue Bird and Fiat Chrysler
If you would invest 1,753 in Blue Bird Corp on December 30, 2023 and sell it today you would earn a total of 2,081 from holding Blue Bird Corp or generate 118.71% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Blue Bird Corp vs. Fiat Chrysler Automobiles
Performance |
Timeline |
Blue Bird Corp |
Fiat Chrysler Automobiles |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
Blue Bird and Fiat Chrysler Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Blue Bird and Fiat Chrysler
The main advantage of trading using opposite Blue Bird and Fiat Chrysler positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Bird position performs unexpectedly, Fiat Chrysler 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 Fiat Chrysler will offset losses from the drop in Fiat Chrysler's long position.Blue Bird vs. General Motors | Blue Bird vs. Li AutoInc | Blue Bird vs. Lotus Technology Warrants | Blue Bird vs. Volcon Inc |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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