Correlation Between Visa and Klepierre

Can any of the company-specific risk be diversified away by investing in both Visa and Klepierre 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 Klepierre 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 Klepierre SA, you can compare the effects of market volatilities on Visa and Klepierre 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 Klepierre. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Klepierre.

Diversification Opportunities for Visa and Klepierre

0.65

Correlation Coefficient

Visa  Klepierre

Poor diversification

The 3 months correlation between Visa and Klepierre is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Klepierre SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Klepierre SA 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 Klepierre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Klepierre SA has no effect on the direction of Visa i.e., Visa and Klepierre go up and down completely randomly.

Pair Corralation between Visa and Klepierre

Taking into account the 90-day investment horizon Visa is expected to generate 1.18 times less return on investment than Klepierre. In addition to that, Visa is 1.19 times more volatile than Klepierre SA. It trades about 0.17 of its total potential returns per unit of risk. Klepierre SA is currently generating about 0.23 per unit of volatility. If you would invest  2,697  in Klepierre SA on December 28, 2024 and sell it today you would earn a total of  381.00  from holding Klepierre SA or generate 14.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.24%
Values	Daily Returns

Visa Class A  vs.  Klepierre SA

Visa Class A

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Visa Class A are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Visa may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Klepierre SA

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Klepierre SA are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Klepierre sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Visa and Klepierre

The main advantage of trading using opposite Visa and Klepierre positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Klepierre 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 Klepierre will offset losses from the drop in Klepierre's long position.

The idea behind Visa Class A and Klepierre SA 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.

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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.