Correlation Between Visa and Perdana Bangun

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Visa and Perdana Bangun 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 Perdana Bangun 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 Perdana Bangun Pusaka, you can compare the effects of market volatilities on Visa and Perdana Bangun 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 Perdana Bangun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Perdana Bangun.

Diversification Opportunities for Visa and Perdana Bangun

0.83
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Visa and Perdana is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Perdana Bangun Pusaka in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perdana Bangun Pusaka 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 Perdana Bangun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perdana Bangun Pusaka has no effect on the direction of Visa i.e., Visa and Perdana Bangun go up and down completely randomly.

Pair Corralation between Visa and Perdana Bangun

Taking into account the 90-day investment horizon Visa is expected to generate 10.76 times less return on investment than Perdana Bangun. But when comparing it to its historical volatility, Visa Class A is 7.56 times less risky than Perdana Bangun. It trades about 0.11 of its potential returns per unit of risk. Perdana Bangun Pusaka is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  94,000  in Perdana Bangun Pusaka on September 17, 2024 and sell it today you would earn a total of  87,500  from holding Perdana Bangun Pusaka or generate 93.09% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy98.46%
ValuesDaily Returns

Visa Class A  vs.  Perdana Bangun Pusaka

 Performance 
       Timeline  
Visa Class A 

Risk-Adjusted Performance

8 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Visa Class A are ranked lower than 8 (%) 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.
Perdana Bangun Pusaka 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Perdana Bangun Pusaka are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Perdana Bangun disclosed solid returns over the last few months and may actually be approaching a breakup point.

Visa and Perdana Bangun Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Visa and Perdana Bangun

The main advantage of trading using opposite Visa and Perdana Bangun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Perdana Bangun 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 Perdana Bangun will offset losses from the drop in Perdana Bangun's long position.
The idea behind Visa Class A and Perdana Bangun Pusaka 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.

Other Complementary Tools

Top Crypto Exchanges
Search and analyze digital assets across top global cryptocurrency exchanges
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Economic Indicators
Top statistical indicators that provide insights into how an economy is performing
Theme Ratings
Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance
Balance Of Power
Check stock momentum by analyzing Balance Of Power indicator and other technical ratios