Correlation Between Visa and Manning Napier
Can any of the company-specific risk be diversified away by investing in both Visa and Manning Napier 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 Manning Napier 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 Manning Napier Pro Blend, you can compare the effects of market volatilities on Visa and Manning Napier 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 Manning Napier. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Manning Napier.
Diversification Opportunities for Visa and Manning Napier
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Visa and Manning is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Manning Napier Pro Blend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manning Napier Pro 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 Manning Napier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manning Napier Pro has no effect on the direction of Visa i.e., Visa and Manning Napier go up and down completely randomly.
Pair Corralation between Visa and Manning Napier
Taking into account the 90-day investment horizon Visa Class A is expected to generate 2.25 times more return on investment than Manning Napier. However, Visa is 2.25 times more volatile than Manning Napier Pro Blend. It trades about 0.09 of its potential returns per unit of risk. Manning Napier Pro Blend is currently generating about 0.1 per unit of risk. If you would invest 20,548 in Visa Class A on August 30, 2024 and sell it today you would earn a total of 10,922 from holding Visa Class A or generate 53.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Visa Class A vs. Manning Napier Pro Blend
Performance |
| Timeline |
| Visa Class A |
| Manning Napier Pro |
Visa and Manning Napier Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Manning Napier
The main advantage of trading using opposite Visa and Manning Napier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Manning Napier 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 Manning Napier will offset losses from the drop in Manning Napier'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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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