Correlation Between Koppers Holdings and Visa
Can any of the company-specific risk be diversified away by investing in both Koppers Holdings and Visa 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 Koppers Holdings and Visa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koppers Holdings and Visa Class A, you can compare the effects of market volatilities on Koppers Holdings and Visa 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 Koppers Holdings with a short position of Visa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koppers Holdings and Visa.
Diversification Opportunities for Koppers Holdings and Visa
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Koppers and Visa is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Koppers Holdings and Visa Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Visa Class A and Koppers Holdings 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 Koppers Holdings are associated (or correlated) with Visa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Visa Class A has no effect on the direction of Koppers Holdings i.e., Koppers Holdings and Visa go up and down completely randomly.
Pair Corralation between Koppers Holdings and Visa
Considering the 90-day investment horizon Koppers Holdings is expected to generate 2.27 times more return on investment than Visa. However, Koppers Holdings is 2.27 times more volatile than Visa Class A. It trades about 0.04 of its potential returns per unit of risk. Visa Class A is currently generating about 0.08 per unit of risk. If you would invest 2,906 in Koppers Holdings on August 31, 2024 and sell it today you would earn a total of 937.00 from holding Koppers Holdings or generate 32.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koppers Holdings vs. Visa Class A
Performance |
| Timeline |
| Koppers Holdings |
| Visa Class A |
Koppers Holdings and Visa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koppers Holdings and Visa
The main advantage of trading using opposite Koppers Holdings and Visa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koppers Holdings position performs unexpectedly, Visa 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 Visa will offset losses from the drop in Visa's long position.| Koppers Holdings vs. H B Fuller | Koppers Holdings vs. Minerals Technologies | Koppers Holdings vs. Quaker Chemical | Koppers Holdings vs. Oil Dri |
| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |