Correlation Between Yamana Gold and Visa

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Can any of the company-specific risk be diversified away by investing in both Yamana Gold and Visa 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 Yamana Gold and Visa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yamana Gold and Visa Class A, you can compare the effects of market volatilities on Yamana Gold and Visa 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 Yamana Gold with a short position of Visa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yamana Gold and Visa.

Diversification Opportunities for Yamana Gold and Visa

-0.45
  Correlation Coefficient

Very good diversification

The 3 months correlation between Yamana and Visa is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Yamana Gold and Visa Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Visa Class A and Yamana Gold 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 Yamana Gold are associated (or correlated) with Visa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Visa Class A has no effect on the direction of Yamana Gold i.e., Yamana Gold and Visa go up and down completely randomly.

Pair Corralation between Yamana Gold and Visa

If you would invest  585.00  in Yamana Gold on December 30, 2023 and sell it today you would earn a total of  0.00  from holding Yamana Gold or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy4.55%
ValuesDaily Returns

Yamana Gold  vs.  Visa Class A

 Performance 
       Timeline  
Yamana Gold 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days Yamana Gold has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Yamana Gold is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Visa Class A 

Risk-Adjusted Performance

11 of 100

 
Low
 
High
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Visa Class A are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent basic indicators, Visa may actually be approaching a critical reversion point that can send shares even higher in April 2024.

Yamana Gold and Visa Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Yamana Gold and Visa

The main advantage of trading using opposite Yamana Gold and Visa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yamana Gold position performs unexpectedly, Visa 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 Visa will offset losses from the drop in Visa's long position.
The idea behind Yamana Gold and Visa Class A pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.

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