Correlation Analysis Between Ford Motor and GM

This module allows you to analyze existing cross correlation between Ford Motor Company and General Motors Company. You can compare the effects of market volatilities on Ford Motor and GM 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 GM. See also your portfolio center. Please also check ongoing floating volatility patterns of Ford Motor and GM.
Horizon     30 Days    Login   to change
Symbolsvs
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Comparative Performance

Ford Motor  
00

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. In spite of latest sluggish performance, the Stock's fundamental drivers remain sound and the ongoing tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.
General Motors  
00

Risk-Adjusted Performance

Over the last 30 days General Motors Company has generated negative risk-adjusted returns adding no value to investors with long positions. Even with considerably steady technical indicators, GM is not utilizing all of its potentials. The ongoing stock price chaos, may contribute to medium term losses for the stakeholders.

Ford Motor and GM Volatility Contrast

 Predicted Return Density 
      Returns 

Ford Motor Company  vs.  General Motors Company

 Performance (%) 
      Timeline 

Pair Volatility

Taking into account the 30 trading days horizon, Ford Motor Company is expected to under-perform the GM. But the stock apears to be less risky and, when comparing its historical volatility, Ford Motor Company is 1.12 times less risky than GM. The stock trades about -0.1 of its potential returns per unit of risk. The General Motors Company is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest  3,874  in General Motors Company on September 16, 2019 and sell it today you would lose (209.00)  from holding General Motors Company or give up 5.39% of portfolio value over 30 days.

Pair Corralation between Ford Motor and GM

0.84
Time Period3 Months [change]
DirectionPositive 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Diversification Opportunities for Ford Motor and GM

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 General Motors Company in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on General Motors 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 GM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General Motors has no effect on the direction of Ford Motor i.e. Ford Motor and GM go up and down completely randomly.
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