Correlation Between Visa and 30 Year
Can any of the company-specific risk be diversified away by investing in both Visa and 30 Year 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 30 Year 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 30 Year Treasury, you can compare the effects of market volatilities on Visa and 30 Year 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 30 Year. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and 30 Year.
Diversification Opportunities for Visa and 30 Year
Excellent diversification
The 3 months correlation between Visa and ZBUSD is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and 30 Year Treasury in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 30 Year Treasury 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 30 Year. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 30 Year Treasury has no effect on the direction of Visa i.e., Visa and 30 Year go up and down completely randomly.
Pair Corralation between Visa and 30 Year
Taking into account the 90-day investment horizon Visa Class A is expected to generate 1.65 times more return on investment than 30 Year. However, Visa is 1.65 times more volatile than 30 Year Treasury. It trades about 0.07 of its potential returns per unit of risk. 30 Year Treasury is currently generating about -0.01 per unit of risk. If you would invest 27,777 in Visa Class A on September 1, 2024 and sell it today you would earn a total of 3,731 from holding Visa Class A or generate 13.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 96.91% |
| Values | Daily Returns |
Visa Class A vs. 30 Year Treasury
Performance |
| Timeline |
| Visa Class A |
| 30 Year Treasury |
Visa and 30 Year Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and 30 Year
The main advantage of trading using opposite Visa and 30 Year positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, 30 Year 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 30 Year will offset losses from the drop in 30 Year's long position.| Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
| 30 Year vs. Aluminum Futures | 30 Year vs. Cocoa | 30 Year vs. Silver Futures | 30 Year vs. 10 Year T Note Futures |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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