Correlation Between Visa and Aerkomm
Can any of the company-specific risk be diversified away by investing in both Visa and Aerkomm 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 Aerkomm 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 Aerkomm, you can compare the effects of market volatilities on Visa and Aerkomm 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 Aerkomm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Aerkomm.
Diversification Opportunities for Visa and Aerkomm
Pay attention - limited upside
The 3 months correlation between Visa and Aerkomm is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Aerkomm in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aerkomm 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 Aerkomm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aerkomm has no effect on the direction of Visa i.e., Visa and Aerkomm go up and down completely randomly.
Pair Corralation between Visa and Aerkomm
Taking into account the 90-day investment horizon Visa is expected to generate 1.98 times less return on investment than Aerkomm. But when comparing it to its historical volatility, Visa Class A is 7.25 times less risky than Aerkomm. It trades about 0.09 of its potential returns per unit of risk. Aerkomm is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 300.00 in Aerkomm on September 3, 2024 and sell it today you would lose (42.00) from holding Aerkomm or give up 14.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Visa Class A vs. Aerkomm
Performance |
| Timeline |
| Visa Class A |
| Aerkomm |
Visa and Aerkomm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Aerkomm
The main advantage of trading using opposite Visa and Aerkomm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Aerkomm 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 Aerkomm will offset losses from the drop in Aerkomm's long position.| Visa vs. American Express | Visa vs. Capital One Financial | Visa vs. Upstart Holdings | Visa vs. Ally Financial |
| Aerkomm vs. AmpliTech Group | Aerkomm vs. AAP Inc | Aerkomm vs. Airgain | Aerkomm vs. AAC Technologies Holdings |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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