Correlation Between Visa and Xiamen ITG
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By analyzing existing cross correlation between Visa Class A and Xiamen ITG Group, you can compare the effects of market volatilities on Visa and Xiamen ITG 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 Xiamen ITG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Xiamen ITG.
Diversification Opportunities for Visa and Xiamen ITG
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Visa and Xiamen is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Xiamen ITG Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen ITG Group 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 Xiamen ITG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen ITG Group has no effect on the direction of Visa i.e., Visa and Xiamen ITG go up and down completely randomly.
Pair Corralation between Visa and Xiamen ITG
Taking into account the 90-day investment horizon Visa is expected to generate 1.62 times less return on investment than Xiamen ITG. But when comparing it to its historical volatility, Visa Class A is 1.97 times less risky than Xiamen ITG. It trades about 0.12 of its potential returns per unit of risk. Xiamen ITG Group is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 578.00 in Xiamen ITG Group on September 23, 2024 and sell it today you would earn a total of 85.00 from holding Xiamen ITG Group or generate 14.71% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 93.85% |
Values | Daily Returns |
Visa Class A vs. Xiamen ITG Group
Performance |
Timeline |
Visa Class A |
Xiamen ITG Group |
Visa and Xiamen ITG Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Visa and Xiamen ITG
The main advantage of trading using opposite Visa and Xiamen ITG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Xiamen ITG 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 Xiamen ITG will offset losses from the drop in Xiamen ITG's long position.The idea behind Visa Class A and Xiamen ITG Group 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.Xiamen ITG vs. China Life Insurance | Xiamen ITG vs. Cinda Securities Co | Xiamen ITG vs. Piotech Inc A | Xiamen ITG vs. Dongxing Sec 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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