Two Equities Correlation Analysis
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This model provides you with a quick lookup of cross correlation between two equities. Please specify two instruments to run the correlation.
Diversification Opportunities for Visa and NYSE Composite
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Visa and NYSE is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and NYSE Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NYSE Composite 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 NYSE Composite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NYSE Composite has no effect on the direction of Visa i.e., Visa and NYSE Composite go up and down completely randomly.
Pair Corralation between Visa and NYSE Composite
Taking into account the 90-day investment horizon Visa is expected to generate 1.58 times less return on investment than NYSE Composite. In addition to that, Visa is 1.41 times more volatile than NYSE Composite. It trades about 0.05 of its total potential returns per unit of risk. NYSE Composite is currently generating about 0.12 per unit of volatility. If you would invest 1,694,911 in NYSE Composite on January 26, 2024 and sell it today you would earn a total of 80,897 from holding NYSE Composite or generate 4.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Visa Class A vs. NYSE Composite
Performance |
| Timeline |
Visa and NYSE Composite Volatility Contrast
Predicted Return Density |
| Returns |
Visa Class A
Pair trading matchups for Visa
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with Visa and NYSE Composite
The main advantage of trading using opposite Visa and NYSE Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, NYSE Composite 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 NYSE Composite will offset losses from the drop in NYSE Composite's long position.| Visa vs. American Express | Visa vs. Capital One Financial | Visa vs. Upstart HoldingsInc | Visa vs. Ally Financial |
| NYSE Composite vs. Nike Inc | NYSE Composite vs. Zoom Video Communications | NYSE Composite vs. Vera Bradley | NYSE Composite vs. Torm PLC Class |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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