Correlation Between Visa and Lokman Hekim

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

Diversification Opportunities for Visa and Lokman Hekim

0.41

Correlation Coefficient

Visa  Lokman Hekim

Very weak diversification

The 3 months correlation between Visa and Lokman is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Lokman Hekim Engurusag in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lokman Hekim Engurusag 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 Lokman Hekim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lokman Hekim Engurusag has no effect on the direction of Visa i.e., Visa and Lokman Hekim go up and down completely randomly.

Pair Corralation between Visa and Lokman Hekim

Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.95 times more return on investment than Lokman Hekim. However, Visa Class A is 1.05 times less risky than Lokman Hekim. It trades about 0.13 of its potential returns per unit of risk. Lokman Hekim Engurusag is currently generating about -0.09 per unit of risk. If you would invest  30,992  in Visa Class A on September 23, 2024 and sell it today you would earn a total of  779.00  from holding Visa Class A or generate 2.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.45%
Values	Daily Returns

Visa Class A  vs.  Lokman Hekim Engurusag

Visa Class A

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Visa Class A are ranked lower than 9 (%) 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 January 2025.

Lokman Hekim Engurusag

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lokman Hekim Engurusag has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, Lokman Hekim is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Visa and Lokman Hekim

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

The idea behind Visa Class A and Lokman Hekim Engurusag 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.