Correlation Between Vietnam Enterprise and New Residential

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

Diversification Opportunities for Vietnam Enterprise and New Residential

0.82

Correlation Coefficient

Vietnam Enterprise  New Residential

Very poor diversification

The 3 months correlation between Vietnam and New is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Vietnam Enterprise Investments and New Residential Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Residential Inve 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 New Residential. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Residential Inve has no effect on the direction of Vietnam Enterprise i.e., Vietnam Enterprise and New Residential go up and down completely randomly.

Pair Corralation between Vietnam Enterprise and New Residential

Assuming the 90 days trading horizon Vietnam Enterprise Investments is expected to generate 0.66 times more return on investment than New Residential. However, Vietnam Enterprise Investments is 1.52 times less risky than New Residential. It trades about 0.51 of its potential returns per unit of risk. New Residential Investment is currently generating about 0.21 per unit of risk. If you would invest  52,000  in Vietnam Enterprise Investments on April 25, 2025 and sell it today you would earn a total of  16,500  from holding Vietnam Enterprise Investments or generate 31.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.41%
Values	Daily Returns

Vietnam Enterprise Investments  vs.  New Residential Investment

Vietnam Enterprise

Risk-Adjusted Performance

Excellent

Compared to the overall equity markets, risk-adjusted returns on investments in Vietnam Enterprise Investments are ranked lower than 40 (%) 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.

New Residential Inve

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in New Residential Investment are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, New Residential unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vietnam Enterprise and New Residential

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

The idea behind Vietnam Enterprise Investments and New Residential Investment 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.