Correlation Between Visa and Hana Materials
Can any of the company-specific risk be diversified away by investing in both Visa and Hana Materials 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 Hana Materials 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 Hana Materials, you can compare the effects of market volatilities on Visa and Hana Materials 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 Hana Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Hana Materials.
Diversification Opportunities for Visa and Hana Materials
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Visa and Hana is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Hana Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hana Materials 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 Hana Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hana Materials has no effect on the direction of Visa i.e., Visa and Hana Materials go up and down completely randomly.
Pair Corralation between Visa and Hana Materials
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.49 times more return on investment than Hana Materials. However, Visa Class A is 2.03 times less risky than Hana Materials. It trades about 0.35 of its potential returns per unit of risk. Hana Materials is currently generating about -0.48 per unit of risk. If you would invest 28,929 in Visa Class A on September 1, 2024 and sell it today you would earn a total of 2,579 from holding Visa Class A or generate 8.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Visa Class A vs. Hana Materials
Performance |
| Timeline |
| Visa Class A |
| Hana Materials |
Visa and Hana Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Hana Materials
The main advantage of trading using opposite Visa and Hana Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Hana Materials 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 Hana Materials will offset losses from the drop in Hana Materials' long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| Hana Materials vs. SK Hynix | Hana Materials vs. LX Semicon Co | Hana Materials vs. Tokai Carbon Korea | Hana Materials vs. People Technology |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |