Correlation Between NorthView Acquisition and Visa

Can any of the company-specific risk be diversified away by investing in both NorthView Acquisition and Visa 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 NorthView Acquisition and Visa into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between NorthView Acquisition and Visa Class A, you can compare the effects of market volatilities on NorthView Acquisition and Visa 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 NorthView Acquisition with a short position of Visa. Check out your portfolio center. Please also check ongoing floating volatility patterns of NorthView Acquisition and Visa.

Diversification Opportunities for NorthView Acquisition and Visa

-0.35

Correlation Coefficient

NorthView Acquisition  Visa

Very good diversification

The 3 months correlation between NorthView and Visa is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding NorthView Acquisition and Visa Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Visa Class A and NorthView Acquisition 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 NorthView Acquisition are associated (or correlated) with Visa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Visa Class A has no effect on the direction of NorthView Acquisition i.e., NorthView Acquisition and Visa go up and down completely randomly.

Pair Corralation between NorthView Acquisition and Visa

Assuming the 90 days horizon NorthView Acquisition is expected to generate 151.94 times more return on investment than Visa. However, NorthView Acquisition is 151.94 times more volatile than Visa Class A. It trades about 0.14 of its potential returns per unit of risk. Visa Class A is currently generating about 0.08 per unit of risk. If you would invest  16.00  in NorthView Acquisition on September 28, 2024 and sell it today you would lose (12.48) from holding NorthView Acquisition or give up 78.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	60.0%
Values	Daily Returns

NorthView Acquisition  vs.  Visa Class A

NorthView Acquisition

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in NorthView Acquisition are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively abnormal fundamental indicators, NorthView Acquisition reported solid returns over the last few months and may actually be approaching a breakup point.

Visa Class A

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Visa Class A are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Visa showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with NorthView Acquisition and Visa

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

The idea behind NorthView Acquisition and Visa Class A 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.