Correlation Between Ford and Triller

Can any of the company-specific risk be diversified away by investing in both Ford and Triller 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 Triller into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ford Motor and Triller Group, you can compare the effects of market volatilities on Ford and Triller 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 Triller. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Triller.

Diversification Opportunities for Ford and Triller

0.25

Correlation Coefficient

Ford  Triller

Modest diversification

The 3 months correlation between Ford and Triller is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Triller Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triller Group 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 Triller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triller Group has no effect on the direction of Ford i.e., Ford and Triller go up and down completely randomly.

Pair Corralation between Ford and Triller

Taking into account the 90-day investment horizon Ford Motor is expected to generate 0.15 times more return on investment than Triller. However, Ford Motor is 6.87 times less risky than Triller. It trades about -0.23 of its potential returns per unit of risk. Triller Group is currently generating about -0.09 per unit of risk. If you would invest  1,080  in Ford Motor on September 22, 2024 and sell it today you would lose (92.00) from holding Ford Motor or give up 8.52% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Ford Motor  vs.  Triller Group

Ford Motor

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ford Motor has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Triller Group

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Triller Group are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Triller showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ford and Triller

The main advantage of trading using opposite Ford and Triller positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Triller 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 Triller will offset losses from the drop in Triller's long position.

The idea behind Ford Motor and Triller Group 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.