Correlation Between Visa and IShares
Can any of the company-specific risk be diversified away by investing in both Visa and IShares 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 IShares 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 IShares, you can compare the effects of market volatilities on Visa and IShares 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 IShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and IShares.
Diversification Opportunities for Visa and IShares
Excellent diversification
The 3 months correlation between Visa and IShares is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and IShares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IShares 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 IShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IShares has no effect on the direction of Visa i.e., Visa and IShares go up and down completely randomly.
Pair Corralation between Visa and IShares
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 | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Visa Class A vs. IShares
Performance |
| Timeline |
| Visa Class A |
| IShares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Visa and IShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and IShares
The main advantage of trading using opposite Visa and IShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, IShares 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 IShares will offset losses from the drop in IShares' long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| IShares vs. iShares Currency Hedged | IShares vs. iShares MSCI United | IShares vs. iShares Currency Hedged | IShares vs. iShares Currency Hedged |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |