Correlation Between Visa and GAMING FAC
Can any of the company-specific risk be diversified away by investing in both Visa and GAMING FAC 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 GAMING FAC 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 GAMING FAC SA, you can compare the effects of market volatilities on Visa and GAMING FAC 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 GAMING FAC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and GAMING FAC.
Diversification Opportunities for Visa and GAMING FAC
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Visa and GAMING is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and GAMING FAC SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GAMING FAC SA 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 GAMING FAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GAMING FAC SA has no effect on the direction of Visa i.e., Visa and GAMING FAC go up and down completely randomly.
Pair Corralation between Visa and GAMING FAC
Taking into account the 90-day investment horizon Visa is expected to generate 1.09 times less return on investment than GAMING FAC. But when comparing it to its historical volatility, Visa Class A is 3.77 times less risky than GAMING FAC. It trades about 0.1 of its potential returns per unit of risk. GAMING FAC SA is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 140.00 in GAMING FAC SA on August 31, 2024 and sell it today you would earn a total of 23.00 from holding GAMING FAC SA or generate 16.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.42% |
| Values | Daily Returns |
Visa Class A vs. GAMING FAC SA
Performance |
| Timeline |
| Visa Class A |
| GAMING FAC SA |
Visa and GAMING FAC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and GAMING FAC
The main advantage of trading using opposite Visa and GAMING FAC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, GAMING FAC 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 GAMING FAC will offset losses from the drop in GAMING FAC's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| GAMING FAC vs. Digilife Technologies Limited | GAMING FAC vs. AEGEAN AIRLINES | GAMING FAC vs. NAKED WINES PLC | GAMING FAC vs. Gol Intelligent Airlines |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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