Correlation Between Visa and Beijing Tongyizhong
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By analyzing existing cross correlation between Visa Class A and Beijing Tongyizhong New, you can compare the effects of market volatilities on Visa and Beijing Tongyizhong 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 Beijing Tongyizhong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Beijing Tongyizhong.
Diversification Opportunities for Visa and Beijing Tongyizhong
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Visa and Beijing is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Beijing Tongyizhong New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Tongyizhong New 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 Beijing Tongyizhong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Tongyizhong New has no effect on the direction of Visa i.e., Visa and Beijing Tongyizhong go up and down completely randomly.
Pair Corralation between Visa and Beijing Tongyizhong
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.38 times more return on investment than Beijing Tongyizhong. However, Visa Class A is 2.65 times less risky than Beijing Tongyizhong. It trades about 0.08 of its potential returns per unit of risk. Beijing Tongyizhong New is currently generating about 0.01 per unit of risk. If you would invest 25,801 in Visa Class A on September 14, 2024 and sell it today you would earn a total of 5,782 from holding Visa Class A or generate 22.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.58% |
| Values | Daily Returns |
Visa Class A vs. Beijing Tongyizhong New
Performance |
| Timeline |
| Visa Class A |
| Beijing Tongyizhong New |
Visa and Beijing Tongyizhong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Beijing Tongyizhong
The main advantage of trading using opposite Visa and Beijing Tongyizhong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Beijing Tongyizhong 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 Beijing Tongyizhong will offset losses from the drop in Beijing Tongyizhong's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| Beijing Tongyizhong vs. Anhui Deli Household | Beijing Tongyizhong vs. Hainan Haiqi Transportation | Beijing Tongyizhong vs. Chongqing Changan Automobile | Beijing Tongyizhong vs. Yindu Kitchen Equipment |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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