Correlation Between Inventiva and Silo Pharma

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

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

Diversification Opportunities for Inventiva and Silo Pharma

-0.36

Correlation Coefficient

Inventiva  Silo Pharma

Very good diversification

The 3 months correlation between Inventiva and Silo is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Inventiva Sa and Silo Pharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silo Pharma 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 Silo Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silo Pharma has no effect on the direction of Inventiva i.e., Inventiva and Silo Pharma go up and down completely randomly.

Pair Corralation between Inventiva and Silo Pharma

Considering the 90-day investment horizon Inventiva Sa is expected to generate 0.98 times more return on investment than Silo Pharma. However, Inventiva Sa is 1.02 times less risky than Silo Pharma. It trades about 0.17 of its potential returns per unit of risk. Silo Pharma is currently generating about -0.29 per unit of risk. If you would invest  217.00  in Inventiva Sa on November 19, 2024 and sell it today you would earn a total of  34.00  from holding Inventiva Sa or generate 15.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Inventiva Sa  vs.  Silo Pharma

Inventiva Sa

Risk-Adjusted Performance

Very Weak

Over the last 90 days Inventiva Sa has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Inventiva is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Silo Pharma

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Silo Pharma are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal essential indicators, Silo Pharma displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Inventiva and Silo Pharma

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

The idea behind Inventiva Sa and Silo Pharma 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.