Correlation Between Fiat Chrysler and Blue Bird
Can any of the company-specific risk be diversified away by investing in both Fiat Chrysler and Blue Bird 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 Fiat Chrysler and Blue Bird into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fiat Chrysler Automobiles and Blue Bird Corp, you can compare the effects of market volatilities on Fiat Chrysler and Blue Bird 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 Fiat Chrysler with a short position of Blue Bird. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fiat Chrysler and Blue Bird.
Diversification Opportunities for Fiat Chrysler and Blue Bird
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fiat and Blue is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Fiat Chrysler Automobiles and Blue Bird Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Bird Corp and Fiat Chrysler 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 Fiat Chrysler Automobiles are associated (or correlated) with Blue Bird. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Bird Corp has no effect on the direction of Fiat Chrysler i.e., Fiat Chrysler and Blue Bird go up and down completely randomly.
Pair Corralation between Fiat Chrysler and Blue Bird
If you would invest (100.00) in Fiat Chrysler Automobiles on January 25, 2024 and sell it today you would earn a total of 100.00 from holding Fiat Chrysler Automobiles or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Fiat Chrysler Automobiles vs. Blue Bird Corp
Performance |
| Timeline |
| Fiat Chrysler Automobiles |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Blue Bird Corp |
Fiat Chrysler and Blue Bird Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fiat Chrysler and Blue Bird
The main advantage of trading using opposite Fiat Chrysler and Blue Bird positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fiat Chrysler position performs unexpectedly, Blue Bird 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 Blue Bird will offset losses from the drop in Blue Bird's long position.| Fiat Chrysler vs. Vector Group | Fiat Chrysler vs. Keurig Dr Pepper | Fiat Chrysler vs. nLIGHT Inc | Fiat Chrysler vs. Westrock Coffee |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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