Correlation Between Visa and ENTERGY
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By analyzing existing cross correlation between Visa Class A and ENTERGY TEX INC, you can compare the effects of market volatilities on Visa and ENTERGY 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 ENTERGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and ENTERGY.
Diversification Opportunities for Visa and ENTERGY
Pay attention - limited upside
The 3 months correlation between Visa and ENTERGY is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and ENTERGY TEX INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ENTERGY TEX INC 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 ENTERGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ENTERGY TEX INC has no effect on the direction of Visa i.e., Visa and ENTERGY go up and down completely randomly.
Pair Corralation between Visa and ENTERGY
Taking into account the 90-day investment horizon Visa Class A is expected to generate 2.44 times more return on investment than ENTERGY. However, Visa is 2.44 times more volatile than ENTERGY TEX INC. It trades about 0.34 of its potential returns per unit of risk. ENTERGY TEX INC is currently generating about -0.11 per unit of risk. If you would invest 29,018 in Visa Class A on September 2, 2024 and sell it today you would earn a total of 2,490 from holding Visa Class A or generate 8.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 85.71% |
| Values | Daily Returns |
Visa Class A vs. ENTERGY TEX INC
Performance |
| Timeline |
| Visa Class A |
| ENTERGY TEX INC |
Visa and ENTERGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and ENTERGY
The main advantage of trading using opposite Visa and ENTERGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, ENTERGY 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 ENTERGY will offset losses from the drop in ENTERGY's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| ENTERGY vs. Biglari Holdings | ENTERGY vs. Boyd Gaming | ENTERGY vs. Willamette Valley Vineyards | ENTERGY vs. BJs Restaurants |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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