Correlation Between FIRST TRUST and VinaCapital Vietnam
Can any of the company-specific risk be diversified away by investing in both FIRST TRUST and VinaCapital Vietnam 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 FIRST TRUST and VinaCapital Vietnam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIRST TRUST INDXX and VinaCapital Vietnam Opportunity, you can compare the effects of market volatilities on FIRST TRUST and VinaCapital Vietnam 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 FIRST TRUST with a short position of VinaCapital Vietnam. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIRST TRUST and VinaCapital Vietnam.
Diversification Opportunities for FIRST TRUST and VinaCapital Vietnam
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FIRST and VinaCapital is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding FIRST TRUST INDXX and VinaCapital Vietnam Opportunit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VinaCapital Vietnam and FIRST TRUST 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 FIRST TRUST INDXX are associated (or correlated) with VinaCapital Vietnam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VinaCapital Vietnam has no effect on the direction of FIRST TRUST i.e., FIRST TRUST and VinaCapital Vietnam go up and down completely randomly.
Pair Corralation between FIRST TRUST and VinaCapital Vietnam
Assuming the 90 days trading horizon FIRST TRUST INDXX is expected to under-perform the VinaCapital Vietnam. But the etf apears to be less risky and, when comparing its historical volatility, FIRST TRUST INDXX is 1.23 times less risky than VinaCapital Vietnam. The etf trades about -0.04 of its potential returns per unit of risk. The VinaCapital Vietnam Opportunity is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 44,870 in VinaCapital Vietnam Opportunity on September 25, 2024 and sell it today you would earn a total of 280.00 from holding VinaCapital Vietnam Opportunity or generate 0.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.67% |
| Values | Daily Returns |
FIRST TRUST INDXX vs. VinaCapital Vietnam Opportunit
Performance |
| Timeline |
| FIRST TRUST INDXX |
| VinaCapital Vietnam |
FIRST TRUST and VinaCapital Vietnam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIRST TRUST and VinaCapital Vietnam
The main advantage of trading using opposite FIRST TRUST and VinaCapital Vietnam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIRST TRUST position performs unexpectedly, VinaCapital Vietnam 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 VinaCapital Vietnam will offset losses from the drop in VinaCapital Vietnam's long position.| FIRST TRUST vs. Scottish Mortgage Investment | FIRST TRUST vs. VinaCapital Vietnam Opportunity | FIRST TRUST vs. Edinburgh Worldwide Investment | FIRST TRUST vs. Baillie Gifford Growth |
| VinaCapital Vietnam vs. Vanguard FTSE Developed | VinaCapital Vietnam vs. Leverage Shares 2x | VinaCapital Vietnam vs. Amundi Index Solutions | VinaCapital Vietnam vs. Amundi Index Solutions |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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