Correlation Between Visa and SITE Centers
Can any of the company-specific risk be diversified away by investing in both Visa and SITE Centers 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 SITE Centers 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 SITE Centers Corp, you can compare the effects of market volatilities on Visa and SITE Centers 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 SITE Centers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and SITE Centers.
Diversification Opportunities for Visa and SITE Centers
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Visa and SITE is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and SITE Centers Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SITE Centers Corp 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 SITE Centers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SITE Centers Corp has no effect on the direction of Visa i.e., Visa and SITE Centers go up and down completely randomly.
Pair Corralation between Visa and SITE Centers
Taking into account the 90-day investment horizon Visa Class A is expected to generate 17.9 times more return on investment than SITE Centers. However, Visa is 17.9 times more volatile than SITE Centers Corp. It trades about 0.23 of its potential returns per unit of risk. SITE Centers Corp is currently generating about 0.07 per unit of risk. If you would invest 29,129 in Visa Class A on September 5, 2024 and sell it today you would earn a total of 1,861 from holding Visa Class A or generate 6.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 77.27% |
| Values | Daily Returns |
Visa Class A vs. SITE Centers Corp
Performance |
| Timeline |
| Visa Class A |
| SITE Centers Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Visa and SITE Centers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and SITE Centers
The main advantage of trading using opposite Visa and SITE Centers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, SITE Centers 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 SITE Centers will offset losses from the drop in SITE Centers' long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| SITE Centers vs. The Gabelli Multimedia | SITE Centers vs. The Gabelli Equity | SITE Centers vs. Virtus AllianzGI Convertible | SITE Centers vs. John Hancock Income |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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