Correlation Between Visa and China Asset
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By analyzing existing cross correlation between Visa Class A and China Asset Management, you can compare the effects of market volatilities on Visa and China Asset 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 China Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and China Asset.
Diversification Opportunities for Visa and China Asset
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Visa and China is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and China Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Asset Management 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 China Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Asset Management has no effect on the direction of Visa i.e., Visa and China Asset go up and down completely randomly.
Pair Corralation between Visa and China Asset
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.8 times more return on investment than China Asset. However, Visa Class A is 1.25 times less risky than China Asset. It trades about 0.36 of its potential returns per unit of risk. China Asset Management is currently generating about -0.4 per unit of risk. If you would invest 34,123 in Visa Class A on December 2, 2024 and sell it today you would earn a total of 2,148 from holding Visa Class A or generate 6.29% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 90.48% |
Values | Daily Returns |
Visa Class A vs. China Asset Management
Performance |
Timeline |
Visa Class A |
China Asset Management |
Visa and China Asset Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Visa and China Asset
The main advantage of trading using opposite Visa and China Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, China Asset 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 China Asset will offset losses from the drop in China Asset's long position.Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
China Asset vs. Luyin Investment Group | China Asset vs. Tieling Newcity Investment | China Asset vs. Nuode Investment Co | China Asset vs. Kingclean Electric Co |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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