Correlation Between Visa and ANJI Technology
Can any of the company-specific risk be diversified away by investing in both Visa and ANJI Technology 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 ANJI Technology 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 ANJI Technology Co, you can compare the effects of market volatilities on Visa and ANJI Technology 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 ANJI Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and ANJI Technology.
Diversification Opportunities for Visa and ANJI Technology
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Visa and ANJI is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and ANJI Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANJI Technology 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 ANJI Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANJI Technology has no effect on the direction of Visa i.e., Visa and ANJI Technology go up and down completely randomly.
Pair Corralation between Visa and ANJI Technology
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.42 times more return on investment than ANJI Technology. However, Visa Class A is 2.37 times less risky than ANJI Technology. It trades about 0.4 of its potential returns per unit of risk. ANJI Technology Co is currently generating about -0.12 per unit of risk. If you would invest 28,134 in Visa Class A on August 30, 2024 and sell it today you would earn a total of 3,336 from holding Visa Class A or generate 11.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Visa Class A vs. ANJI Technology Co
Performance |
| Timeline |
| Visa Class A |
| ANJI Technology |
Visa and ANJI Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and ANJI Technology
The main advantage of trading using opposite Visa and ANJI Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, ANJI Technology 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 ANJI Technology will offset losses from the drop in ANJI Technology's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
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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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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