Correlation Between Visa and Codan
Can any of the company-specific risk be diversified away by investing in both Visa and Codan 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 Codan 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 Codan Limited, you can compare the effects of market volatilities on Visa and Codan 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 Codan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Codan.
Diversification Opportunities for Visa and Codan
Average diversification
The 3 months correlation between Visa and Codan is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Codan Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Codan Limited 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 Codan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Codan Limited has no effect on the direction of Visa i.e., Visa and Codan go up and down completely randomly.
Pair Corralation between Visa and Codan
If you would invest 29,018 in Visa Class A on September 2, 2024 and sell it today you would earn a total of 2,490 from holding Visa Class A or generate 8.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Visa Class A vs. Codan Limited
Performance |
| Timeline |
| Visa Class A |
| Codan Limited |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Visa and Codan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Codan
The main advantage of trading using opposite Visa and Codan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Codan 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 Codan will offset losses from the drop in Codan's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| Codan vs. Nanalysis Scientific Corp | Codan vs. Genasys | Codan vs. Kraken Robotics | Codan vs. Teledyne Technologies Incorporated |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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