Correlation Between Visa and CONSUMERS
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By analyzing existing cross correlation between Visa Class A and CONSUMERS ENERGY 395, you can compare the effects of market volatilities on Visa and CONSUMERS 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 CONSUMERS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and CONSUMERS.
Diversification Opportunities for Visa and CONSUMERS
Very good diversification
The 3 months correlation between Visa and CONSUMERS is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and CONSUMERS ENERGY 395 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CONSUMERS ENERGY 5 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 CONSUMERS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CONSUMERS ENERGY 5 has no effect on the direction of Visa i.e., Visa and CONSUMERS go up and down completely randomly.
Pair Corralation between Visa and CONSUMERS
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.81 times more return on investment than CONSUMERS. However, Visa Class A is 1.24 times less risky than CONSUMERS. It trades about 0.32 of its potential returns per unit of risk. CONSUMERS ENERGY 395 is currently generating about 0.05 per unit of risk. If you would invest 33,398 in Visa Class A on November 28, 2024 and sell it today you would earn a total of 1,811 from holding Visa Class A or generate 5.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 42.86% |
| Values | Daily Returns |
Visa Class A vs. CONSUMERS ENERGY 395
Performance |
| Timeline |
| Visa Class A |
| CONSUMERS ENERGY 5 |
Visa and CONSUMERS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and CONSUMERS
The main advantage of trading using opposite Visa and CONSUMERS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, CONSUMERS 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 CONSUMERS will offset losses from the drop in CONSUMERS's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| CONSUMERS vs. Altria Group | CONSUMERS vs. ZhongAn Online P | CONSUMERS vs. 51Talk Online Education | CONSUMERS vs. Stagwell |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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