Correlation Between VinFast Auto and Dana

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

Diversification Opportunities for VinFast Auto and Dana

0.64

Correlation Coefficient

VinFast Auto  Dana

Poor diversification

The 3 months correlation between VinFast and Dana is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding VinFast Auto Ltd and Dana Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dana Inc 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 Dana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dana Inc has no effect on the direction of VinFast Auto i.e., VinFast Auto and Dana go up and down completely randomly.

Pair Corralation between VinFast Auto and Dana

Assuming the 90 days horizon VinFast Auto Ltd is expected to under-perform the Dana. In addition to that, VinFast Auto is 3.46 times more volatile than Dana Inc. It trades about -0.39 of its total potential returns per unit of risk. Dana Inc is currently generating about -0.03 per unit of volatility. If you would invest  1,264  in Dana Inc on January 30, 2024 and sell it today you would lose (16.00) from holding Dana Inc or give up 1.27% of portfolio value over 90 days.

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

VinFast Auto Ltd  vs.  Dana Inc

VinFast Auto

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VinFast Auto Ltd has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in May 2024. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Dana Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dana Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with VinFast Auto and Dana

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

The idea behind VinFast Auto Ltd and Dana Inc 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..