Correlation Between Visa and AFFLUENT MEDICAL
Can any of the company-specific risk be diversified away by investing in both Visa and AFFLUENT MEDICAL 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 Visa and AFFLUENT MEDICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Visa Class A and AFFLUENT MEDICAL SAS, you can compare the effects of market volatilities on Visa and AFFLUENT MEDICAL 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 Visa with a short position of AFFLUENT MEDICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and AFFLUENT MEDICAL.
Diversification Opportunities for Visa and AFFLUENT MEDICAL
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Visa and AFFLUENT is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and AFFLUENT MEDICAL SAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AFFLUENT MEDICAL SAS and Visa 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 Visa Class A are associated (or correlated) with AFFLUENT MEDICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AFFLUENT MEDICAL SAS has no effect on the direction of Visa i.e., Visa and AFFLUENT MEDICAL go up and down completely randomly.
Pair Corralation between Visa and AFFLUENT MEDICAL
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.33 times more return on investment than AFFLUENT MEDICAL. However, Visa Class A is 3.0 times less risky than AFFLUENT MEDICAL. It trades about 0.08 of its potential returns per unit of risk. AFFLUENT MEDICAL SAS is currently generating about 0.0 per unit of risk. If you would invest 27,011 in Visa Class A on October 13, 2024 and sell it today you would earn a total of 3,760 from holding Visa Class A or generate 13.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.62% |
| Values | Daily Returns |
Visa Class A vs. AFFLUENT MEDICAL SAS
Performance |
| Timeline |
| Visa Class A |
| AFFLUENT MEDICAL SAS |
Visa and AFFLUENT MEDICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and AFFLUENT MEDICAL
The main advantage of trading using opposite Visa and AFFLUENT MEDICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, AFFLUENT MEDICAL 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 AFFLUENT MEDICAL will offset losses from the drop in AFFLUENT MEDICAL's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| AFFLUENT MEDICAL vs. Apple Inc | AFFLUENT MEDICAL vs. Apple Inc | AFFLUENT MEDICAL vs. Apple Inc | AFFLUENT MEDICAL vs. Apple Inc |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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