Correlation Between VinaCapital Vietnam and LS 1x
Can any of the company-specific risk be diversified away by investing in both VinaCapital Vietnam and LS 1x 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 VinaCapital Vietnam and LS 1x into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VinaCapital Vietnam Opportunity and LS 1x Amazon, you can compare the effects of market volatilities on VinaCapital Vietnam and LS 1x 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 VinaCapital Vietnam with a short position of LS 1x. Check out your portfolio center. Please also check ongoing floating volatility patterns of VinaCapital Vietnam and LS 1x.
Diversification Opportunities for VinaCapital Vietnam and LS 1x
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between VinaCapital and 1AMZ is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding VinaCapital Vietnam Opportunit and LS 1x Amazon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LS 1x Amazon and VinaCapital Vietnam 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 VinaCapital Vietnam Opportunity are associated (or correlated) with LS 1x. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LS 1x Amazon has no effect on the direction of VinaCapital Vietnam i.e., VinaCapital Vietnam and LS 1x go up and down completely randomly.
Pair Corralation between VinaCapital Vietnam and LS 1x
Assuming the 90 days trading horizon VinaCapital Vietnam is expected to generate 24.83 times less return on investment than LS 1x. But when comparing it to its historical volatility, VinaCapital Vietnam Opportunity is 2.07 times less risky than LS 1x. It trades about 0.01 of its potential returns per unit of risk. LS 1x Amazon is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 284.00 in LS 1x Amazon on August 25, 2024 and sell it today you would earn a total of 321.00 from holding LS 1x Amazon or generate 113.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
VinaCapital Vietnam Opportunit vs. LS 1x Amazon
Performance |
| Timeline |
| VinaCapital Vietnam |
| LS 1x Amazon |
VinaCapital Vietnam and LS 1x Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VinaCapital Vietnam and LS 1x
The main advantage of trading using opposite VinaCapital Vietnam and LS 1x positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VinaCapital Vietnam position performs unexpectedly, LS 1x 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 LS 1x will offset losses from the drop in LS 1x's long position.| VinaCapital Vietnam vs. Edinburgh Worldwide Investment | VinaCapital Vietnam vs. BlackRock Latin American | VinaCapital Vietnam vs. iShares MSCI Japan | VinaCapital Vietnam vs. Amundi EUR High |
| LS 1x vs. Scottish Mortgage Investment | LS 1x vs. VinaCapital Vietnam Opportunity | LS 1x vs. Edinburgh Worldwide Investment | LS 1x vs. Baillie Gifford Growth |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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