Correlation Between Ford and CHRYSLER CORP

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

Diversification Opportunities for Ford and CHRYSLER CORP

  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Ford and CHRYSLER is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and CHRYSLER CORP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHRYSLER CORP 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 CHRYSLER CORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHRYSLER CORP has no effect on the direction of Ford i.e., Ford and CHRYSLER CORP go up and down completely randomly.

Pair Corralation between Ford and CHRYSLER CORP

If you would invest (100.00)  in CHRYSLER CORP on March 29, 2022 and sell it today you would earn a total of  100.00  from holding CHRYSLER CORP or generate -100.0% return on investment over 90 days.
Time Period3 Months [change]
ValuesDaily Returns

Ford Motor  vs.  CHRYSLER CORP

 Performance (%) 
Ford Motor 
Ford Performance
0 of 100
Over the last 90 days Ford Motor has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of sluggish performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in July 2022. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Structure and Payout Changes

Forward Annual Dividend Yield
Payout Ratio
Last Split Factor
Forward Annual Dividend Rate
Dividend Date
Ex Dividend Date
Last Split Date

Ford Price Channel

CHRYSLER Performance
0 of 100
Over the last 90 days CHRYSLER CORP has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, CHRYSLER CORP is not utilizing all of its potentials. The new stock price disturbance, may contribute to short-term losses for the investors.

Ford and CHRYSLER CORP Volatility Contrast

 Predicted Return Density 

Pair Trading with Ford and CHRYSLER CORP

The main advantage of trading using opposite Ford and CHRYSLER CORP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, CHRYSLER CORP 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 CHRYSLER CORP will offset losses from the drop in CHRYSLER CORP's long position.
The idea behind Ford Motor and CHRYSLER CORP 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.

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