Correlation Between Visa and Sparindex INDEX
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By analyzing existing cross correlation between Visa Class A and Sparindex INDEX OMX, you can compare the effects of market volatilities on Visa and Sparindex INDEX 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 Sparindex INDEX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Sparindex INDEX.
Diversification Opportunities for Visa and Sparindex INDEX
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Visa and Sparindex is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Sparindex INDEX OMX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sparindex INDEX OMX 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 Sparindex INDEX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sparindex INDEX OMX has no effect on the direction of Visa i.e., Visa and Sparindex INDEX go up and down completely randomly.
Pair Corralation between Visa and Sparindex INDEX
Taking into account the 90-day investment horizon Visa Class A is expected to generate 1.03 times more return on investment than Sparindex INDEX. However, Visa is 1.03 times more volatile than Sparindex INDEX OMX. It trades about 0.09 of its potential returns per unit of risk. Sparindex INDEX OMX is currently generating about -0.01 per unit of risk. If you would invest 20,975 in Visa Class A on September 3, 2024 and sell it today you would earn a total of 10,533 from holding Visa Class A or generate 50.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Visa Class A vs. Sparindex INDEX OMX
Performance |
| Timeline |
| Visa Class A |
| Sparindex INDEX OMX |
Visa and Sparindex INDEX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Sparindex INDEX
The main advantage of trading using opposite Visa and Sparindex INDEX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Sparindex INDEX 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 Sparindex INDEX will offset losses from the drop in Sparindex INDEX's long position.| Visa vs. American Express | Visa vs. Capital One Financial | Visa vs. Upstart Holdings | Visa vs. Ally Financial |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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