Correlation Between Ford and QVC

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

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

Diversification Opportunities for Ford and QVC

0.28

Correlation Coefficient

Ford  QVC

Modest diversification

The 3 months correlation between Ford and QVC is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and QVC Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QVC 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 QVC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QVC Group has no effect on the direction of Ford i.e., Ford and QVC go up and down completely randomly.

Pair Corralation between Ford and QVC

Given the investment horizon of 90 days Ford Motor is expected to generate 0.16 times more return on investment than QVC. However, Ford Motor is 6.16 times less risky than QVC. It trades about 0.12 of its potential returns per unit of risk. QVC Group is currently generating about 0.0 per unit of risk. If you would invest  2,103  in Ford Motor on July 2, 2025 and sell it today you would earn a total of  112.00  from holding Ford Motor or generate 5.33% return on investment over 90 days.

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

Ford Motor  vs.  QVC Group

Ford Motor

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ford Motor are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Ford is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

QVC Group

Risk-Adjusted Performance

Weakest

Over the last 90 days QVC Group has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical and fundamental indicators, QVC is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Ford and QVC

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

The idea behind Ford Motor and QVC 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.

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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .