Correlation Between Faraday Future and VinFast Auto
Can any of the company-specific risk be diversified away by investing in both Faraday Future and VinFast Auto 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 Faraday Future and VinFast Auto into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Faraday Future Intelligent and VinFast Auto Ltd, you can compare the effects of market volatilities on Faraday Future and VinFast Auto 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 Faraday Future with a short position of VinFast Auto. Check out your portfolio center. Please also check ongoing floating volatility patterns of Faraday Future and VinFast Auto.
Diversification Opportunities for Faraday Future and VinFast Auto
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Faraday and VinFast is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Faraday Future Intelligent and VinFast Auto Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VinFast Auto and Faraday Future 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 Faraday Future Intelligent are associated (or correlated) with VinFast Auto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VinFast Auto has no effect on the direction of Faraday Future i.e., Faraday Future and VinFast Auto go up and down completely randomly.
Pair Corralation between Faraday Future and VinFast Auto
Given the investment horizon of 90 days Faraday Future Intelligent is expected to under-perform the VinFast Auto. In addition to that, Faraday Future is 1.55 times more volatile than VinFast Auto Ltd. It trades about 0.0 of its total potential returns per unit of risk. VinFast Auto Ltd is currently generating about 0.03 per unit of volatility. If you would invest 1,045 in VinFast Auto Ltd on August 28, 2024 and sell it today you would lose (652.00) from holding VinFast Auto Ltd or give up 62.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 91.81% |
| Values | Daily Returns |
Faraday Future Intelligent vs. VinFast Auto Ltd
Performance |
| Timeline |
| Faraday Future Intel |
| VinFast Auto |
Faraday Future and VinFast Auto Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Faraday Future and VinFast Auto
The main advantage of trading using opposite Faraday Future and VinFast Auto positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Faraday Future position performs unexpectedly, VinFast Auto 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 VinFast Auto will offset losses from the drop in VinFast Auto's long position.The idea behind Faraday Future Intelligent and VinFast Auto Ltd 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.| VinFast Auto vs. Tesla Inc | VinFast Auto vs. Mullen Automotive | VinFast Auto vs. BYD Company Limited | VinFast Auto vs. Ford Motor |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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