Correlation Between Visa and Alpha Bank
Can any of the company-specific risk be diversified away by investing in both Visa and Alpha Bank 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 Alpha Bank 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 Alpha Bank SA, you can compare the effects of market volatilities on Visa and Alpha Bank 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 Alpha Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Alpha Bank.
Diversification Opportunities for Visa and Alpha Bank
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Visa and Alpha is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Alpha Bank SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alpha Bank 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 Alpha Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alpha Bank SA has no effect on the direction of Visa i.e., Visa and Alpha Bank go up and down completely randomly.
Pair Corralation between Visa and Alpha Bank
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.28 times more return on investment than Alpha Bank. However, Visa Class A is 3.55 times less risky than Alpha Bank. It trades about 0.35 of its potential returns per unit of risk. Alpha Bank SA is currently generating about -0.04 per unit of risk. If you would invest 28,929 in Visa Class A on September 1, 2024 and sell it today you would earn a total of 2,579 from holding Visa Class A or generate 8.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Visa Class A vs. Alpha Bank SA
Performance |
| Timeline |
| Visa Class A |
| Alpha Bank SA |
Visa and Alpha Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Alpha Bank
The main advantage of trading using opposite Visa and Alpha Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Alpha Bank 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 Alpha Bank will offset losses from the drop in Alpha Bank's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| Alpha Bank vs. National Bank of | Alpha Bank vs. Piraeus Bank SA | Alpha Bank vs. Eurobank Ergasias SA | Alpha Bank vs. First Citizens BancShares |
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.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |