Correlation Between Ford and Multimanager Lifestyle
Can any of the company-specific risk be diversified away by investing in both Ford and Multimanager Lifestyle 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 Multimanager Lifestyle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Multimanager Lifestyle Growth, you can compare the effects of market volatilities on Ford and Multimanager Lifestyle 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 Multimanager Lifestyle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Multimanager Lifestyle.
Diversification Opportunities for Ford and Multimanager Lifestyle
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ford and Multimanager is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Multimanager Lifestyle Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multimanager Lifestyle 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 Multimanager Lifestyle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multimanager Lifestyle has no effect on the direction of Ford i.e., Ford and Multimanager Lifestyle go up and down completely randomly.
Pair Corralation between Ford and Multimanager Lifestyle
If you would invest 1,196 in Ford Motor on March 12, 2024 and sell it today you would earn a total of 23.50 from holding Ford Motor or generate 1.96% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Ford Motor vs. Multimanager Lifestyle Growth
Performance |
Timeline |
Ford Motor |
Multimanager Lifestyle |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ford and Multimanager Lifestyle Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ford and Multimanager Lifestyle
The main advantage of trading using opposite Ford and Multimanager Lifestyle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Multimanager Lifestyle 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 Multimanager Lifestyle will offset losses from the drop in Multimanager Lifestyle's long position.Ford vs. GreenPower Motor | Ford vs. Zapp Electric Vehicles | Ford vs. BAIC Motor | Ford vs. Zapp Electric Vehicles |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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