Correlation Between Visa and MAP Aktif
Can any of the company-specific risk be diversified away by investing in both Visa and MAP Aktif 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 MAP Aktif 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 MAP Aktif Adiperkasa, you can compare the effects of market volatilities on Visa and MAP Aktif 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 MAP Aktif. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and MAP Aktif.
Diversification Opportunities for Visa and MAP Aktif
Poor diversification
The 3 months correlation between Visa and MAP is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and MAP Aktif Adiperkasa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAP Aktif Adiperkasa 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 MAP Aktif. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAP Aktif Adiperkasa has no effect on the direction of Visa i.e., Visa and MAP Aktif go up and down completely randomly.
Pair Corralation between Visa and MAP Aktif
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.4 times more return on investment than MAP Aktif. However, Visa Class A is 2.53 times less risky than MAP Aktif. It trades about 0.35 of its potential returns per unit of risk. MAP Aktif Adiperkasa is currently generating about -0.02 per unit of risk. 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 Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Visa Class A vs. MAP Aktif Adiperkasa
Performance |
| Timeline |
| Visa Class A |
| MAP Aktif Adiperkasa |
Visa and MAP Aktif Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and MAP Aktif
The main advantage of trading using opposite Visa and MAP Aktif positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, MAP Aktif 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 MAP Aktif will offset losses from the drop in MAP Aktif's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
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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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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