Correlation Between Vietnam Enterprise and Lowland Investment

Can any of the company-specific risk be diversified away by investing in both Vietnam Enterprise and Lowland Investment 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 Vietnam Enterprise and Lowland Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Vietnam Enterprise Investments and Lowland Investment Co, you can compare the effects of market volatilities on Vietnam Enterprise and Lowland Investment 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 Vietnam Enterprise with a short position of Lowland Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vietnam Enterprise and Lowland Investment.

Diversification Opportunities for Vietnam Enterprise and Lowland Investment

0.7

Correlation Coefficient

Vietnam Enterprise  Lowland Investment

Poor diversification

The 3 months correlation between Vietnam and Lowland is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Vietnam Enterprise Investments and Lowland Investment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lowland Investment and Vietnam Enterprise 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 Vietnam Enterprise Investments are associated (or correlated) with Lowland Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lowland Investment has no effect on the direction of Vietnam Enterprise i.e., Vietnam Enterprise and Lowland Investment go up and down completely randomly.

Pair Corralation between Vietnam Enterprise and Lowland Investment

Assuming the 90 days trading horizon Vietnam Enterprise Investments is expected to generate 1.56 times more return on investment than Lowland Investment. However, Vietnam Enterprise is 1.56 times more volatile than Lowland Investment Co. It trades about 0.43 of its potential returns per unit of risk. Lowland Investment Co is currently generating about 0.18 per unit of risk. If you would invest  52,700  in Vietnam Enterprise Investments on May 7, 2025 and sell it today you would earn a total of  16,700  from holding Vietnam Enterprise Investments or generate 31.69% return on investment over 90 days.

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

Vietnam Enterprise Investments  vs.  Lowland Investment Co

Vietnam Enterprise

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Vietnam Enterprise Investments are ranked lower than 33 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Vietnam Enterprise unveiled solid returns over the last few months and may actually be approaching a breakup point.

Lowland Investment

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Lowland Investment Co are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Lowland Investment may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Vietnam Enterprise and Lowland Investment

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

The idea behind Vietnam Enterprise Investments and Lowland Investment Co 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.

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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.