Correlation Between Visa and Bank Mega
Can any of the company-specific risk be diversified away by investing in both Visa and Bank Mega 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 Bank Mega 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 Bank Mega Tbk, you can compare the effects of market volatilities on Visa and Bank Mega 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 Bank Mega. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Bank Mega.
Diversification Opportunities for Visa and Bank Mega
Excellent diversification
The 3 months correlation between Visa and Bank is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Bank Mega Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Mega Tbk 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 Bank Mega. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Mega Tbk has no effect on the direction of Visa i.e., Visa and Bank Mega go up and down completely randomly.
Pair Corralation between Visa and Bank Mega
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.57 times more return on investment than Bank Mega. However, Visa Class A is 1.76 times less risky than Bank Mega. It trades about 0.09 of its potential returns per unit of risk. Bank Mega Tbk is currently generating about -0.02 per unit of risk. If you would invest 22,614 in Visa Class A on October 24, 2024 and sell it today you would earn a total of 9,742 from holding Visa Class A or generate 43.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 96.11% |
| Values | Daily Returns |
Visa Class A vs. Bank Mega Tbk
Performance |
| Timeline |
| Visa Class A |
| Bank Mega Tbk |
Visa and Bank Mega Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Bank Mega
The main advantage of trading using opposite Visa and Bank Mega positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Bank Mega 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 Bank Mega will offset losses from the drop in Bank Mega's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| Bank Mega vs. Bank Ocbc Nisp | Bank Mega vs. Bank Mayapada Internasional | Bank Mega vs. Bank Permata Tbk | Bank Mega vs. Bank Pan Indonesia |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |