Correlation Between Visa and Bactiquant
Can any of the company-specific risk be diversified away by investing in both Visa and Bactiquant 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 Bactiquant 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 Bactiquant AS, you can compare the effects of market volatilities on Visa and Bactiquant 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 Bactiquant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Bactiquant.
Diversification Opportunities for Visa and Bactiquant
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Visa and Bactiquant is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Bactiquant AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bactiquant AS 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 Bactiquant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bactiquant AS has no effect on the direction of Visa i.e., Visa and Bactiquant go up and down completely randomly.
Pair Corralation between Visa and Bactiquant
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.29 times more return on investment than Bactiquant. However, Visa Class A is 3.45 times less risky than Bactiquant. It trades about 0.35 of its potential returns per unit of risk. Bactiquant AS is currently generating about -0.1 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 | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Visa Class A vs. Bactiquant AS
Performance |
| Timeline |
| Visa Class A |
| Bactiquant AS |
Visa and Bactiquant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Bactiquant
The main advantage of trading using opposite Visa and Bactiquant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Bactiquant 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 Bactiquant will offset losses from the drop in Bactiquant's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| Bactiquant vs. Sparinvest INDEX Globale | Bactiquant vs. Bavarian Nordic | Bactiquant vs. Investeringsselskabet Luxor AS | Bactiquant vs. cBrain AS |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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