Correlation Between Visa and Amundi FTSE
Can any of the company-specific risk be diversified away by investing in both Visa and Amundi FTSE 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 Amundi FTSE 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 Amundi FTSE EPRANAREIT, you can compare the effects of market volatilities on Visa and Amundi FTSE 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 Amundi FTSE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Amundi FTSE.
Diversification Opportunities for Visa and Amundi FTSE
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Visa and Amundi is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Amundi FTSE EPRANAREIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi FTSE EPRANAREIT 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 Amundi FTSE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi FTSE EPRANAREIT has no effect on the direction of Visa i.e., Visa and Amundi FTSE go up and down completely randomly.
Pair Corralation between Visa and Amundi FTSE
Taking into account the 90-day investment horizon Visa Class A is expected to generate 1.47 times more return on investment than Amundi FTSE. However, Visa is 1.47 times more volatile than Amundi FTSE EPRANAREIT. It trades about 0.1 of its potential returns per unit of risk. Amundi FTSE EPRANAREIT is currently generating about 0.05 per unit of risk. If you would invest 27,011 in Visa Class A on September 15, 2024 and sell it today you would earn a total of 4,463 from holding Visa Class A or generate 16.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.67% |
| Values | Daily Returns |
Visa Class A vs. Amundi FTSE EPRANAREIT
Performance |
| Timeline |
| Visa Class A |
| Amundi FTSE EPRANAREIT |
Visa and Amundi FTSE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Amundi FTSE
The main advantage of trading using opposite Visa and Amundi FTSE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Amundi FTSE 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 Amundi FTSE will offset losses from the drop in Amundi FTSE's long position.The idea behind Visa Class A and Amundi FTSE EPRANAREIT pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Amundi FTSE vs. Baloise Holding AG | Amundi FTSE vs. 21Shares Polkadot ETP | Amundi FTSE vs. UBS ETF MSCI | Amundi FTSE vs. BB Biotech AG |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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