Correlation Between VinFast Auto and Lotus Technology
Can any of the company-specific risk be diversified away by investing in both VinFast Auto and Lotus Technology 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 VinFast Auto and Lotus Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VinFast Auto Ltd and Lotus Technology American, you can compare the effects of market volatilities on VinFast Auto and Lotus Technology 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 VinFast Auto with a short position of Lotus Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of VinFast Auto and Lotus Technology.
Diversification Opportunities for VinFast Auto and Lotus Technology
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between VinFast and Lotus is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding VinFast Auto Ltd and Lotus Technology American in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lotus Technology American and VinFast Auto 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 VinFast Auto Ltd are associated (or correlated) with Lotus Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lotus Technology American has no effect on the direction of VinFast Auto i.e., VinFast Auto and Lotus Technology go up and down completely randomly.
Pair Corralation between VinFast Auto and Lotus Technology
Considering the 90-day investment horizon VinFast Auto Ltd is expected to generate 3.82 times more return on investment than Lotus Technology. However, VinFast Auto is 3.82 times more volatile than Lotus Technology American. It trades about 0.03 of its potential returns per unit of risk. Lotus Technology American is currently generating about -0.03 per unit of risk. If you would invest 1,045 in VinFast Auto Ltd on October 20, 2024 and sell it today you would lose (633.00) from holding VinFast Auto Ltd or give up 60.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 72.73% |
| Values | Daily Returns |
VinFast Auto Ltd vs. Lotus Technology American
Performance |
| Timeline |
| VinFast Auto |
| Lotus Technology American |
VinFast Auto and Lotus Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VinFast Auto and Lotus Technology
The main advantage of trading using opposite VinFast Auto and Lotus Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VinFast Auto position performs unexpectedly, Lotus Technology 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 Lotus Technology will offset losses from the drop in Lotus Technology's long position.| VinFast Auto vs. Mediag3 | VinFast Auto vs. Academy Sports Outdoors | VinFast Auto vs. Canaf Investments | VinFast Auto vs. Flutter Entertainment plc |
| Lotus Technology vs. Western Acquisition Ventures | Lotus Technology vs. Artisan Partners Asset | Lotus Technology vs. Cortus Metals | Lotus Technology vs. Gatos Silver |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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