Correlation Between Visa and Medical Equipment
Can any of the company-specific risk be diversified away by investing in both Visa and Medical Equipment 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 Medical Equipment 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 Medical Equipment And, you can compare the effects of market volatilities on Visa and Medical Equipment 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 Medical Equipment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Medical Equipment.
Diversification Opportunities for Visa and Medical Equipment
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Visa and Medical is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Medical Equipment And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medical Equipment And 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 Medical Equipment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medical Equipment And has no effect on the direction of Visa i.e., Visa and Medical Equipment go up and down completely randomly.
Pair Corralation between Visa and Medical Equipment
Taking into account the 90-day investment horizon Visa Class A is expected to generate 1.48 times more return on investment than Medical Equipment. However, Visa is 1.48 times more volatile than Medical Equipment And. It trades about 0.33 of its potential returns per unit of risk. Medical Equipment And is currently generating about 0.24 per unit of risk. If you would invest 28,960 in Visa Class A on August 31, 2024 and sell it today you would earn a total of 2,548 from holding Visa Class A or generate 8.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Visa Class A vs. Medical Equipment And
Performance |
| Timeline |
| Visa Class A |
| Medical Equipment And |
Visa and Medical Equipment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Medical Equipment
The main advantage of trading using opposite Visa and Medical Equipment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Medical Equipment 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 Medical Equipment will offset losses from the drop in Medical Equipment's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| Medical Equipment vs. Software And It | Medical Equipment vs. Health Care Services | Medical Equipment vs. Retailing Portfolio Retailing | Medical Equipment vs. Health Care Portfolio |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Global Correlations Find global opportunities by holding instruments from different markets |