Correlation Between Visa and SSgA
Can any of the company-specific risk be diversified away by investing in both Visa and SSgA 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 SSgA 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 SSgA, you can compare the effects of market volatilities on Visa and SSgA 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 SSgA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and SSgA.
Diversification Opportunities for Visa and SSgA
Pay attention - limited upside
The 3 months correlation between Visa and SSgA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and SSgA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSgA 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 SSgA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSgA has no effect on the direction of Visa i.e., Visa and SSgA go up and down completely randomly.
Pair Corralation between Visa and SSgA
If you would invest 28,365 in Visa Class A on August 29, 2024 and sell it today you would earn a total of 2,817 from holding Visa Class A or generate 9.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Visa Class A vs. SSgA
Performance |
| Timeline |
| Visa Class A |
| SSgA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Visa and SSgA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and SSgA
The main advantage of trading using opposite Visa and SSgA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, SSgA 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 SSgA will offset losses from the drop in SSgA's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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