Correlation Between Visa and Canfor Pulp
Can any of the company-specific risk be diversified away by investing in both Visa and Canfor Pulp 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 Canfor Pulp 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 Canfor Pulp Products, you can compare the effects of market volatilities on Visa and Canfor Pulp 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 Canfor Pulp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and Canfor Pulp.
Diversification Opportunities for Visa and Canfor Pulp
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Visa and Canfor is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and Canfor Pulp Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canfor Pulp Products 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 Canfor Pulp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canfor Pulp Products has no effect on the direction of Visa i.e., Visa and Canfor Pulp go up and down completely randomly.
Pair Corralation between Visa and Canfor Pulp
Taking into account the 90-day investment horizon Visa Class A is expected to generate 0.24 times more return on investment than Canfor Pulp. However, Visa Class A is 4.19 times less risky than Canfor Pulp. It trades about -0.06 of its potential returns per unit of risk. Canfor Pulp Products is currently generating about -0.1 per unit of risk. If you would invest 34,937 in Visa Class A on September 2, 2025 and sell it today you would lose (1,493) from holding Visa Class A or give up 4.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Visa Class A vs. Canfor Pulp Products
Performance |
| Timeline |
| Visa Class A |
| Canfor Pulp Products |
Visa and Canfor Pulp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visa and Canfor Pulp
The main advantage of trading using opposite Visa and Canfor Pulp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, Canfor Pulp 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 Canfor Pulp will offset losses from the drop in Canfor Pulp's long position.| Visa vs. Regal Real Estate | Visa vs. Crombie Real Estate | Visa vs. Dynasty Fine Wines | Visa vs. DATA Communications Management |
| Canfor Pulp vs. DRI Healthcare Trust | Canfor Pulp vs. Leons Furniture Limited | Canfor Pulp vs. Bausch Health Companies | Canfor Pulp vs. WELL Health Technologies |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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