Correlation Between Visa and Origin Energy
Can any of the company-specific risk be diversified away by investing in both Visa and Origin Energy 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 Origin Energy 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 Origin Energy Ltd, you can compare the effects of market volatilities on Visa and Origin Energy 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 Origin Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Origin Energy.
Diversification Opportunities for Visa and Origin Energy
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Visa and Origin is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Origin Energy Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Energy 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 Origin Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Origin Energy has no effect on the direction of Visa i.e., Visa and Origin Energy go up and down completely randomly.
Pair Corralation between Visa and Origin Energy
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.44 times more return on investment than Origin Energy. However, Visa Class A is 2.29 times less risky than Origin Energy. It trades about 0.11 of its potential returns per unit of risk. Origin Energy Ltd is currently generating about 0.05 per unit of risk. If you would invest 21,122 in Visa Class A on December 2, 2024 and sell it today you would earn a total of 15,149 from holding Visa Class A or generate 71.72% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 76.36% |
Values | Daily Returns |
Visa Class A vs. Origin Energy Ltd
Performance |
Timeline |
Visa Class A |
Origin Energy |
Visa and Origin Energy Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Visa and Origin Energy
The main advantage of trading using opposite Visa and Origin Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Origin Energy 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 Origin Energy will offset losses from the drop in Origin Energy's long position.Visa vs. American Express | Visa vs. PayPal Holdings | Visa vs. Capital One Financial | Visa vs. Upstart Holdings |
Origin Energy vs. BP plc | Origin Energy vs. China Petroleum Chemical | Origin Energy vs. TotalEnergies SE | Origin Energy vs. Shell PLC |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
CEOs Directory Screen CEOs from public companies around the world | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |