Correlation Between Visa and Indo Kordsa
Can any of the company-specific risk be diversified away by investing in both Visa and Indo Kordsa 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 Indo Kordsa 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 Indo Kordsa Tbk, you can compare the effects of market volatilities on Visa and Indo Kordsa 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 Indo Kordsa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Indo Kordsa.
Diversification Opportunities for Visa and Indo Kordsa
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Visa and Indo is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Indo Kordsa Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indo Kordsa Tbk 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 Indo Kordsa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indo Kordsa Tbk has no effect on the direction of Visa i.e., Visa and Indo Kordsa go up and down completely randomly.
Pair Corralation between Visa and Indo Kordsa
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.77 times more return on investment than Indo Kordsa. However, Visa Class A is 1.29 times less risky than Indo Kordsa. It trades about 0.26 of its potential returns per unit of risk. Indo Kordsa Tbk is currently generating about -0.04 per unit of risk. If you would invest 33,398 in Visa Class A on November 27, 2024 and sell it today you would earn a total of 1,455 from holding Visa Class A or generate 4.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.0% |
| Values | Daily Returns |
Visa Class A vs. Indo Kordsa Tbk
Performance |
| Timeline |
| Visa Class A |
| Indo Kordsa Tbk |
Visa and Indo Kordsa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Indo Kordsa
The main advantage of trading using opposite Visa and Indo Kordsa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Indo Kordsa 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 Indo Kordsa will offset losses from the drop in Indo Kordsa's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| Indo Kordsa vs. Goodyear Indonesia Tbk | Indo Kordsa vs. Sepatu Bata Tbk | Indo Kordsa vs. Indospring Tbk | Indo Kordsa vs. Ever Shine Textile |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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