Correlation Between Visa and Nordic Halibut
Can any of the company-specific risk be diversified away by investing in both Visa and Nordic Halibut 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 Nordic Halibut 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 Nordic Halibut AS, you can compare the effects of market volatilities on Visa and Nordic Halibut 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 Nordic Halibut. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Nordic Halibut.
Diversification Opportunities for Visa and Nordic Halibut
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Visa and Nordic is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Nordic Halibut AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordic Halibut AS 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 Nordic Halibut. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordic Halibut AS has no effect on the direction of Visa i.e., Visa and Nordic Halibut go up and down completely randomly.
Pair Corralation between Visa and Nordic Halibut
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.42 times more return on investment than Nordic Halibut. However, Visa Class A is 2.36 times less risky than Nordic Halibut. It trades about 0.56 of its potential returns per unit of risk. Nordic Halibut AS is currently generating about -0.08 per unit of risk. If you would invest 31,260 in Visa Class A on November 9, 2024 and sell it today you would earn a total of 3,488 from holding Visa Class A or generate 11.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Visa Class A vs. Nordic Halibut AS
Performance |
| Timeline |
| Visa Class A |
| Nordic Halibut AS |
Visa and Nordic Halibut Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Nordic Halibut
The main advantage of trading using opposite Visa and Nordic Halibut positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Nordic Halibut 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 Nordic Halibut will offset losses from the drop in Nordic Halibut's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| Nordic Halibut vs. Nordic Aqua Partners | Nordic Halibut vs. Andfjord Salmon AS | Nordic Halibut vs. Salmon Evolution Holding | Nordic Halibut vs. Arctic Fish Holding |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Transaction History View history of all your transactions and understand their impact on performance |