Correlation Between Visa and Golden Heaven
Can any of the company-specific risk be diversified away by investing in both Visa and Golden Heaven 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 Golden Heaven 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 Golden Heaven Group, you can compare the effects of market volatilities on Visa and Golden Heaven 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 Golden Heaven. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Golden Heaven.
Diversification Opportunities for Visa and Golden Heaven
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Visa and Golden is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Golden Heaven Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Heaven Group 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 Golden Heaven. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Heaven Group has no effect on the direction of Visa i.e., Visa and Golden Heaven go up and down completely randomly.
Pair Corralation between Visa and Golden Heaven
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.15 times more return on investment than Golden Heaven. However, Visa Class A is 6.63 times less risky than Golden Heaven. It trades about 0.35 of its potential returns per unit of risk. Golden Heaven Group is currently generating about -0.12 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. Golden Heaven Group
Performance |
| Timeline |
| Visa Class A |
| Golden Heaven Group |
Visa and Golden Heaven Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Golden Heaven
The main advantage of trading using opposite Visa and Golden Heaven positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Golden Heaven 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 Golden Heaven will offset losses from the drop in Golden Heaven's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| Golden Heaven vs. Cimpress NV | Golden Heaven vs. Suburban Propane Partners | Golden Heaven vs. WiMi Hologram Cloud | Golden Heaven vs. Vistra Energy Corp |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |