Correlation Between Ford and Amir Marketing
Can any of the company-specific risk be diversified away by investing in both Ford and Amir Marketing 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 Amir Marketing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Amir Marketing and, you can compare the effects of market volatilities on Ford and Amir Marketing 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 Amir Marketing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Amir Marketing.
Diversification Opportunities for Ford and Amir Marketing
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ford and Amir is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Amir Marketing and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amir Marketing 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 Amir Marketing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amir Marketing has no effect on the direction of Ford i.e., Ford and Amir Marketing go up and down completely randomly.
Pair Corralation between Ford and Amir Marketing
Taking into account the 90-day investment horizon Ford is expected to generate 5.65 times less return on investment than Amir Marketing. But when comparing it to its historical volatility, Ford Motor is 1.18 times less risky than Amir Marketing. It trades about 0.09 of its potential returns per unit of risk. Amir Marketing and is currently generating about 0.43 of returns per unit of risk over similar time horizon. If you would invest 200,545 in Amir Marketing and on January 26, 2024 and sell it today you would earn a total of 42,255 from holding Amir Marketing and or generate 21.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 76.19% |
| Values | Daily Returns |
Ford Motor vs. Amir Marketing and
Performance |
| Timeline |
| Ford Motor |
| Amir Marketing |
Ford and Amir Marketing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Amir Marketing
The main advantage of trading using opposite Ford and Amir Marketing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Amir Marketing 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 Amir Marketing will offset losses from the drop in Amir Marketing's long position.The idea behind Ford Motor and Amir Marketing and 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.| Amir Marketing vs. Alony Hetz Properties | Amir Marketing vs. Melisron | Amir Marketing vs. Shufersal | Amir Marketing vs. Israel Discount Bank |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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