Correlation Analysis Between Ford Motor and American Airlines

This module allows you to analyze existing cross correlation between Ford Motor Company and American Airlines Group. You can compare the effects of market volatilities on Ford Motor and American Airlines 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 Motor with a short position of American Airlines. See also your portfolio center. Please also check ongoing floating volatility patterns of Ford Motor and American Airlines.
Horizon     30 Days    Login   to change
Symbolsvs
Compare Efficiency

Comparative Performance

Ford Motor  
0

Risk-Adjusted Performance

Over the last 30 days Ford Motor Company has generated negative risk-adjusted returns adding no value to investors with long positions.
American Airlines  
0

Risk-Adjusted Performance

Over the last 30 days American Airlines Group has generated negative risk-adjusted returns adding no value to investors with long positions.

Ford Motor and American Airlines Volatility Contrast

 Predicted Return Density 
      Returns 

Ford Motor Company  vs.  American Airlines Group Inc

 Performance (%) 
      Timeline 

Pair Volatility

Taking into account the 30 trading days horizon, Ford Motor Company is expected to generate 0.73 times more return on investment than American Airlines. However, Ford Motor Company is 1.37 times less risky than American Airlines. It trades about -0.05 of its potential returns per unit of risk. American Airlines Group is currently generating about -0.08 per unit of risk. If you would invest  913.00  in Ford Motor Company on December 23, 2018 and sell it today you would lose (63.00)  from holding Ford Motor Company or give up 6.9% of portfolio value over 30 days.

Pair Corralation between Ford Motor and American Airlines

0.88
Time Period2 Months [change]
DirectionPositive 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Diversification Opportunities for Ford Motor and American Airlines

Ford Motor Company diversification synergy

Very poor diversification

Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor Company and American Airlines Group Inc in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on American Airlines and Ford Motor 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 Company are associated (or correlated) with American Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Airlines has no effect on the direction of Ford Motor i.e. Ford Motor and American Airlines go up and down completely randomly.

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See also your portfolio center. Please also try Volatility Analysis module to get historical volatility and risk analysis based on latest market data.


 
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