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Is Visa the reliably volatile stock every trader is looking for?

07 December 2022

Visa Inc, headquartered in the US, is one of the world's most valuable companies. Visa's global network processes over 100 billion transactions per year, with an average volume of $6.8 trillion (USD). It’s big business, but who’s behind the trillion-dollar entity and why is volatility as regular as a heartbeat?

Who holds Visa?

If you want to know who controls Visa Inc. then you'll need to look at the makeup of their share registry. Hedge funds don't hold a large stake in Visa, which is strange given the high and rhythmic volatility seen on the charts.

A group of institutions own 75% of shares in the company, and stand to benefit the most from stock price upticks. The Vanguard Group is the largest shareholder, but they own only 7% of shares. BlackRock is the second largest with 6%. State Street Global Advisors owns about 3%. 25 other people collectively own less than 50% of the company's shares.

Board members own $217 million worth of shares. General public ownership (GPO) account for 24% of the ownership, so the public has an active voice in Visa’s decision-making.

Visa stock price actions are quite the mystery. There are no anonymous whales of any significance, pushing and pulling at the stock prices for personal gain. We know exactly who controls the vast amount of shares, and they are not the typical pump-and-dump crowd at all. So what’s causing this volatile yet attractive (for traders) range?

Could it be as simple as the market reacting to the earning reports?

Driving Visa stock prices

In 2022, as is the norm, Visa announced its earning reports in January, April, July, and October. You may speculate that price moves in the weeks that follow those Visa reports have a correlation to the sentiment of the reports, but that doesn’t mean it will always follow such a pattern, although volatility is unquestionably something to expect every time.

In the last report, net revenue in the fiscal year 2022 was $29.3 billion. An impressive increase of 22%, driven by global increases in payment volume, cross-border volume, and transactions. And what a reaction we saw on the charts. But there’s more to Visa than the earning reports.

International traveling increased during the quarter as USD gained strength. Spending on travel and entertainment rose compared to the previous year. Despite all the recession-mongering throughout 2022 and the stock market downturn, spending is once again on the rise, as are many stocks.

Did the world avoid or delay a recession? Is it time to “go long” again? Is Visa stock a good choice for short and long-term traders?

Should you trade Visa stock right now?

Sadly, Visa stock, like so many others, has been on the rise for a while and has passed the most opportune moment to buy. If the current rally continues, a buy order might yield some profit, but it might be a little late to get in on Visa.

Keep your eye on the Visa chart for a drawback. If it doesn’t come, consider waiting for the next reversal. Given Visa’s past volatility and two-month cycles, you might not have to wait too long.

2023 is, for some, believed to be the recessionary reset year for global finance, so past performance may not indicate future market moves. Be sure to manage your leverage when trading Visa stock. Exness’ stop protection features are also highly recommended when trading such volatile instruments.

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