Correlation Between Visa and ETFS WNA
Can any of the company-specific risk be diversified away by investing in both Visa and ETFS WNA 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 ETFS WNA 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 ETFS WNA Global, you can compare the effects of market volatilities on Visa and ETFS WNA 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 ETFS WNA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and ETFS WNA.
Diversification Opportunities for Visa and ETFS WNA
Pay attention - limited upside
The 3 months correlation between Visa and ETFS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and ETFS WNA Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ETFS WNA Global 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 ETFS WNA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ETFS WNA Global has no effect on the direction of Visa i.e., Visa and ETFS WNA go up and down completely randomly.
Pair Corralation between Visa and ETFS WNA
If you would invest 30,990 in Visa Class A on September 22, 2024 and sell it today you would earn a total of 781.00 from holding Visa Class A or generate 2.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Visa Class A vs. ETFS WNA Global
Performance |
| Timeline |
| Visa Class A |
| ETFS WNA Global |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Visa and ETFS WNA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and ETFS WNA
The main advantage of trading using opposite Visa and ETFS WNA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, ETFS WNA 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 ETFS WNA will offset losses from the drop in ETFS WNA's long position.The idea behind Visa Class A and ETFS WNA Global 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.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 Stocks Directory module to find actively traded stocks across global markets.
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