Correlation Between Ford and BankInvest Emerging
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By analyzing existing cross correlation between Ford Motor and BankInvest Emerging, you can compare the effects of market volatilities on Ford and BankInvest Emerging 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 BankInvest Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and BankInvest Emerging.
Diversification Opportunities for Ford and BankInvest Emerging
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ford and BankInvest is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and BankInvest Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BankInvest Emerging 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 BankInvest Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BankInvest Emerging has no effect on the direction of Ford i.e., Ford and BankInvest Emerging go up and down completely randomly.
Pair Corralation between Ford and BankInvest Emerging
Taking into account the 90-day investment horizon Ford Motor is expected to generate 6.5 times more return on investment than BankInvest Emerging. However, Ford is 6.5 times more volatile than BankInvest Emerging. It trades about 0.01 of its potential returns per unit of risk. BankInvest Emerging is currently generating about -0.17 per unit of risk. If you would invest 1,290 in Ford Motor on January 25, 2024 and sell it today you would earn a total of 1.00 from holding Ford Motor or generate 0.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
Ford Motor vs. BankInvest Emerging
Performance |
| Timeline |
| Ford Motor |
| BankInvest Emerging |
Ford and BankInvest Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and BankInvest Emerging
The main advantage of trading using opposite Ford and BankInvest Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, BankInvest Emerging 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 BankInvest Emerging will offset losses from the drop in BankInvest Emerging's long position.The idea behind Ford Motor and BankInvest Emerging 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.| BankInvest Emerging vs. Jyske Invest Nye | BankInvest Emerging vs. Jyske Invest Nye | BankInvest Emerging vs. Jyske Invest Hjt | BankInvest Emerging vs. Jyske Invest Lange |
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 Managers module to screen money managers from public funds and ETFs managed around the world.
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