Pair Correlation Between Visa and American Airlines

This module allows you to analyze existing cross correlation between Visa Inc and American Airlines Group Inc. You can compare the effects of market volatilities on Visa and American Airlines 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 American Airlines. See also your portfolio center. Please also check ongoing floating volatility patterns of Visa and American Airlines.
 Time Horizon     30 Days    Login   to change
Symbolsvs
 Visa Inc  vs   American Airlines Group Inc
 Performance (%) 
      Timeline 

Pair Volatility

Taking into account the 30 trading days horizon, Visa is expected to generate 2.03 times less return on investment than American Airlines. But when comparing it to its historical volatility, Visa Inc is 2.44 times less risky than American Airlines. It trades about 0.47 of its potential returns per unit of risk. American Airlines Group Inc is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest  5,149  in American Airlines Group Inc on December 18, 2017 and sell it today you would earn a total of  697  from holding American Airlines Group Inc or generate 13.54% return on investment over 30 days.

Correlation Coefficient

Pair Corralation between Visa and American Airlines
0.74

Parameters

Time Period1 Month [change]
DirectionPositive 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Diversification

Poor diversification

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

Comparative Volatility

 Predicted Return Density 
      Returns 

Visa Inc

  
30 

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Visa Inc are ranked lower than 30 (%) of all global equities and portfolios over the last 30 days.

American Airlines Group

  
25 

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in American Airlines Group Inc are ranked lower than 25 (%) of all global equities and portfolios over the last 30 days.