Correlation Between Visa and Amundi ETF
Can any of the company-specific risk be diversified away by investing in both Visa and Amundi ETF 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 Amundi ETF 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 Amundi ETF PEA, you can compare the effects of market volatilities on Visa and Amundi ETF 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 Amundi ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Amundi ETF.
Diversification Opportunities for Visa and Amundi ETF
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Visa and Amundi is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Amundi ETF PEA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi ETF PEA 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 Amundi ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi ETF PEA has no effect on the direction of Visa i.e., Visa and Amundi ETF go up and down completely randomly.
Pair Corralation between Visa and Amundi ETF
Taking into account the 90-day investment horizon Visa Class A is expected to generate 1.52 times more return on investment than Amundi ETF. However, Visa is 1.52 times more volatile than Amundi ETF PEA. It trades about 0.36 of its potential returns per unit of risk. Amundi ETF PEA is currently generating about -0.12 per unit of risk. If you would invest 28,365 in Visa Class A on August 28, 2024 and sell it today you would earn a total of 2,954 from holding Visa Class A or generate 10.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Visa Class A vs. Amundi ETF PEA
Performance |
| Timeline |
| Visa Class A |
| Amundi ETF PEA |
Visa and Amundi ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Amundi ETF
The main advantage of trading using opposite Visa and Amundi ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Amundi ETF 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 Amundi ETF will offset losses from the drop in Amundi ETF's long position.| Visa vs. American Express | Visa vs. Morningstar Unconstrained Allocation | Visa vs. Sitka Gold Corp | Visa vs. MSCI ACWI exAUCONSUMER |
| Amundi ETF vs. Amundi ETF PEA | Amundi ETF vs. Amundi ETF PEA | Amundi ETF vs. Amundi ETF PEA | Amundi ETF vs. Amundi Index Solutions |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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