Correlation Between Visa and Gajah Tunggal
Can any of the company-specific risk be diversified away by investing in both Visa and Gajah Tunggal 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 Gajah Tunggal 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 Gajah Tunggal Tbk, you can compare the effects of market volatilities on Visa and Gajah Tunggal 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 Gajah Tunggal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Gajah Tunggal.
Diversification Opportunities for Visa and Gajah Tunggal
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Visa and Gajah is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Gajah Tunggal Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gajah Tunggal 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 Gajah Tunggal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gajah Tunggal Tbk has no effect on the direction of Visa i.e., Visa and Gajah Tunggal go up and down completely randomly.
Pair Corralation between Visa and Gajah Tunggal
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.29 times more return on investment than Gajah Tunggal. However, Visa Class A is 3.48 times less risky than Gajah Tunggal. It trades about 0.08 of its potential returns per unit of risk. Gajah Tunggal Tbk is currently generating about 0.02 per unit of risk. If you would invest 23,668 in Visa Class A on August 28, 2024 and sell it today you would earn a total of 7,651 from holding Visa Class A or generate 32.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.76% |
| Values | Daily Returns |
Visa Class A vs. Gajah Tunggal Tbk
Performance |
| Timeline |
| Visa Class A |
| Gajah Tunggal Tbk |
Visa and Gajah Tunggal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Gajah Tunggal
The main advantage of trading using opposite Visa and Gajah Tunggal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Gajah Tunggal 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 Gajah Tunggal will offset losses from the drop in Gajah Tunggal's long position.| Visa vs. American Express | Visa vs. Morningstar Unconstrained Allocation | Visa vs. Sitka Gold Corp | Visa vs. MSCI ACWI exAUCONSUMER |
| Gajah Tunggal vs. Perusahaan Perkebunan London | Gajah Tunggal vs. Solusi Bangun Indonesia | Gajah Tunggal vs. Ciputra Development Tbk | Gajah Tunggal vs. Global Mediacom Tbk |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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