Correlation Between Inventiva and Rezolute

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

By analyzing existing cross correlation between Inventiva Sa and Rezolute, you can compare the effects of market volatilities on Inventiva and Rezolute 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 Inventiva with a short position of Rezolute. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inventiva and Rezolute.

Diversification Opportunities for Inventiva and Rezolute

-0.71

Correlation Coefficient

Inventiva  Rezolute

Pay attention - limited upside

The 3 months correlation between Inventiva and Rezolute is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Inventiva Sa and Rezolute in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rezolute and Inventiva 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 Inventiva Sa are associated (or correlated) with Rezolute. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rezolute has no effect on the direction of Inventiva i.e., Inventiva and Rezolute go up and down completely randomly.

Pair Corralation between Inventiva and Rezolute

Considering the 90-day investment horizon Inventiva Sa is expected to generate 1.1 times more return on investment than Rezolute. However, Inventiva is 1.1 times more volatile than Rezolute. It trades about 0.12 of its potential returns per unit of risk. Rezolute is currently generating about -0.2 per unit of risk. If you would invest  227.00  in Inventiva Sa on December 30, 2024 and sell it today you would earn a total of  64.00  from holding Inventiva Sa or generate 28.19% return on investment over 90 days.

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

Inventiva Sa  vs.  Rezolute

Inventiva Sa

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Inventiva Sa are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Inventiva sustained solid returns over the last few months and may actually be approaching a breakup point.

Rezolute

Risk-Adjusted Performance

Very Weak

Over the last 90 days Rezolute has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's essential indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Inventiva and Rezolute

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

The idea behind Inventiva Sa and Rezolute 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.