Correlation Between Ford and Bollore SA

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Ford and Bollore SA 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 Bollore SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Bollore SA, you can compare the effects of market volatilities on Ford and Bollore SA 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 Bollore SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Bollore SA.

Diversification Opportunities for Ford and Bollore SA

-0.09
  Correlation Coefficient

Good diversification

The 3 months correlation between Ford and Bollore is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Bollore SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bollore SA 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 Bollore SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bollore SA has no effect on the direction of Ford i.e., Ford and Bollore SA go up and down completely randomly.

Pair Corralation between Ford and Bollore SA

Taking into account the 90-day investment horizon Ford Motor is expected to generate 1.68 times more return on investment than Bollore SA. However, Ford is 1.68 times more volatile than Bollore SA. It trades about 0.02 of its potential returns per unit of risk. Bollore SA is currently generating about -0.01 per unit of risk. If you would invest  1,063  in Ford Motor on September 5, 2024 and sell it today you would earn a total of  19.00  from holding Ford Motor or generate 1.79% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy98.46%
ValuesDaily Returns

Ford Motor  vs.  Bollore SA

 Performance 
       Timeline  
Ford Motor 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Ford Motor are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, Ford is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.
Bollore SA 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Bollore SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong essential indicators, Bollore SA is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Ford and Bollore SA Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Ford and Bollore SA

The main advantage of trading using opposite Ford and Bollore SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Bollore SA 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 Bollore SA will offset losses from the drop in Bollore SA's long position.
The idea behind Ford Motor and Bollore SA 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.
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.

Other Complementary Tools

Portfolio Comparator
Compare the composition, asset allocations and performance of any two portfolios in your account
Theme Ratings
Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
CEOs Directory
Screen CEOs from public companies around the world