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|
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 unsteady 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.
Over the last 30 days General Motors Company has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unsteady performance, the Stock's technical indicators remain steady and the new chaos on Wall Street may also be a sign of medium term gains for the business stakeholders.
Ford Motor and GM Volatility Contrast
Predicted Return Density
Ford Motor Company vs. General Motors Company
Taking into account the 30 trading days horizon, Ford Motor Company is expected to generate 0.92 times more return on investment than GM. However, Ford Motor Company is 1.09 times less risky than GM. It trades about -0.08 of its potential returns per unit of risk. General Motors Company is currently generating about -0.08 per unit of risk. If you would invest 1,017 in Ford Motor Company on September 21, 2019 and sell it today you would lose (88.00) from holding Ford Motor Company or give up 8.65% of portfolio value over 30 days.
Pair Corralation between Ford Motor and GM
|Time Period||3 Months [change]|
Diversification Opportunities for Ford Motor and GM
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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