Correlation Between Visa and UNITED
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By analyzing existing cross correlation between Visa Class A and UNITED TECHNOLOGIES P, you can compare the effects of market volatilities on Visa and UNITED 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 UNITED. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and UNITED.
Diversification Opportunities for Visa and UNITED
Excellent diversification
The 3 months correlation between Visa and UNITED is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and UNITED TECHNOLOGIES P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNITED TECHNOLOGIES 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 UNITED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNITED TECHNOLOGIES has no effect on the direction of Visa i.e., Visa and UNITED go up and down completely randomly.
Pair Corralation between Visa and UNITED
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.94 times more return on investment than UNITED. However, Visa Class A is 1.06 times less risky than UNITED. It trades about 0.33 of its potential returns per unit of risk. UNITED TECHNOLOGIES P is currently generating about 0.02 per unit of risk. If you would invest 28,960 in Visa Class A on August 31, 2024 and sell it today you would earn a total of 2,510 from holding Visa Class A or generate 8.67% 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. UNITED TECHNOLOGIES P
Performance |
| Timeline |
| Visa Class A |
| UNITED TECHNOLOGIES |
Visa and UNITED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and UNITED
The main advantage of trading using opposite Visa and UNITED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, UNITED 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 UNITED will offset losses from the drop in UNITED's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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