Correlation Between VinFast Auto and Aperam PK

Can any of the company-specific risk be diversified away by investing in both VinFast Auto and Aperam PK 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 Aperam PK 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 Aperam PK, you can compare the effects of market volatilities on VinFast Auto and Aperam PK 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 Aperam PK. Check out your portfolio center. Please also check ongoing floating volatility patterns of VinFast Auto and Aperam PK.

Diversification Opportunities for VinFast Auto and Aperam PK

-0.89

Correlation Coefficient

VinFast Auto  Aperam PK

Pay attention - limited upside

The 3 months correlation between VinFast and Aperam is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding VinFast Auto Ltd and Aperam PK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aperam PK 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 Aperam PK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aperam PK has no effect on the direction of VinFast Auto i.e., VinFast Auto and Aperam PK go up and down completely randomly.

Pair Corralation between VinFast Auto and Aperam PK

Assuming the 90 days horizon VinFast Auto Ltd is expected to generate 7.29 times more return on investment than Aperam PK. However, VinFast Auto is 7.29 times more volatile than Aperam PK. It trades about 0.04 of its potential returns per unit of risk. Aperam PK is currently generating about 0.26 per unit of risk. If you would invest  39.00  in VinFast Auto Ltd on December 30, 2024 and sell it today you would lose (5.00) from holding VinFast Auto Ltd or give up 12.82% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

VinFast Auto Ltd  vs.  Aperam PK

VinFast Auto

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in VinFast Auto Ltd are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, VinFast Auto showed solid returns over the last few months and may actually be approaching a breakup point.

Aperam PK

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Aperam PK are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile primary indicators, Aperam PK showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with VinFast Auto and Aperam PK

The main advantage of trading using opposite VinFast Auto and Aperam PK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VinFast Auto position performs unexpectedly, Aperam PK 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 Aperam PK will offset losses from the drop in Aperam PK's long position.

The idea behind VinFast Auto Ltd and Aperam PK 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.

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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.