Correlation Between Visa and KRUNGTHAI CARD
Can any of the company-specific risk be diversified away by investing in both Visa and KRUNGTHAI CARD 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 KRUNGTHAI CARD 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 KRUNGTHAI CARD FGN, you can compare the effects of market volatilities on Visa and KRUNGTHAI CARD 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 KRUNGTHAI CARD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and KRUNGTHAI CARD.
Diversification Opportunities for Visa and KRUNGTHAI CARD
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Visa and KRUNGTHAI is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and KRUNGTHAI CARD FGN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KRUNGTHAI CARD FGN 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 KRUNGTHAI CARD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KRUNGTHAI CARD FGN has no effect on the direction of Visa i.e., Visa and KRUNGTHAI CARD go up and down completely randomly.
Pair Corralation between Visa and KRUNGTHAI CARD
Taking into account the 90-day investment horizon Visa is expected to generate 3.33 times less return on investment than KRUNGTHAI CARD. But when comparing it to its historical volatility, Visa Class A is 1.62 times less risky than KRUNGTHAI CARD. It trades about 0.14 of its potential returns per unit of risk. KRUNGTHAI CARD FGN is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 120.00 in KRUNGTHAI CARD FGN on October 28, 2024 and sell it today you would earn a total of 21.00 from holding KRUNGTHAI CARD FGN or generate 17.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Visa Class A vs. KRUNGTHAI CARD FGN
Performance |
| Timeline |
| Visa Class A |
| KRUNGTHAI CARD FGN |
Visa and KRUNGTHAI CARD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and KRUNGTHAI CARD
The main advantage of trading using opposite Visa and KRUNGTHAI CARD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, KRUNGTHAI CARD 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 KRUNGTHAI CARD will offset losses from the drop in KRUNGTHAI CARD's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| KRUNGTHAI CARD vs. VULCAN MATERIALS | KRUNGTHAI CARD vs. Martin Marietta Materials | KRUNGTHAI CARD vs. AEGEAN AIRLINES | KRUNGTHAI CARD vs. The Yokohama Rubber |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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