Correlation Between Visa and Nordea Invest
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By analyzing existing cross correlation between Visa Class A and Nordea Invest Basis, you can compare the effects of market volatilities on Visa and Nordea Invest 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 Nordea Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Nordea Invest.
Diversification Opportunities for Visa and Nordea Invest
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Visa and Nordea is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Nordea Invest Basis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordea Invest Basis 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 Nordea Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordea Invest Basis has no effect on the direction of Visa i.e., Visa and Nordea Invest go up and down completely randomly.
Pair Corralation between Visa and Nordea Invest
Taking into account the 90-day investment horizon Visa Class A is expected to generate 1.69 times more return on investment than Nordea Invest. However, Visa is 1.69 times more volatile than Nordea Invest Basis. It trades about 0.08 of its potential returns per unit of risk. Nordea Invest Basis is currently generating about 0.06 per unit of risk. If you would invest 22,557 in Visa Class A on September 19, 2024 and sell it today you would earn a total of 9,273 from holding Visa Class A or generate 41.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.32% |
| Values | Daily Returns |
Visa Class A vs. Nordea Invest Basis
Performance |
| Timeline |
| Visa Class A |
| Nordea Invest Basis |
Visa and Nordea Invest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Nordea Invest
The main advantage of trading using opposite Visa and Nordea Invest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Nordea Invest 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 Nordea Invest will offset losses from the drop in Nordea Invest's long position.The idea behind Visa Class A and Nordea Invest Basis 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.| Nordea Invest vs. Nordea Bank Abp | Nordea Invest vs. Laan Spar Bank | Nordea Invest vs. Formuepleje Mix Medium | Nordea Invest vs. Nordinvestments AS |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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