Correlation Between Visa and I Jang
Can any of the company-specific risk be diversified away by investing in both Visa and I Jang 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 I Jang 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 I Jang Industrial, you can compare the effects of market volatilities on Visa and I Jang 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 I Jang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and I Jang.
Diversification Opportunities for Visa and I Jang
Very good diversification
The 3 months correlation between Visa and 8342 is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and I Jang Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on I Jang Industrial 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 I Jang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of I Jang Industrial has no effect on the direction of Visa i.e., Visa and I Jang go up and down completely randomly.
Pair Corralation between Visa and I Jang
Taking into account the 90-day investment horizon Visa is expected to generate 1.31 times less return on investment than I Jang. But when comparing it to its historical volatility, Visa Class A is 1.8 times less risky than I Jang. It trades about 0.09 of its potential returns per unit of risk. I Jang Industrial is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 7,180 in I Jang Industrial on September 3, 2024 and sell it today you would earn a total of 1,420 from holding I Jang Industrial or generate 19.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.65% |
| Values | Daily Returns |
Visa Class A vs. I Jang Industrial
Performance |
| Timeline |
| Visa Class A |
| I Jang Industrial |
Visa and I Jang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and I Jang
The main advantage of trading using opposite Visa and I Jang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, I Jang 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 I Jang will offset losses from the drop in I Jang's long position.| Visa vs. American Express | Visa vs. Capital One Financial | Visa vs. Upstart Holdings | Visa vs. Ally Financial |
| I Jang vs. AVerMedia Technologies | I Jang vs. Min Aik Technology | I Jang vs. Uniform Industrial Corp | I Jang vs. WiseChip Semiconductor |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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