Correlation Between Kaltura and Valneva SE

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

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

Diversification Opportunities for Kaltura and Valneva SE

0.68

Correlation Coefficient

Kaltura  Valneva SE

Poor diversification

The 3 months correlation between Kaltura and Valneva is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Kaltura and Valneva SE ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Valneva SE ADR and Kaltura 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 Kaltura are associated (or correlated) with Valneva SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Valneva SE ADR has no effect on the direction of Kaltura i.e., Kaltura and Valneva SE go up and down completely randomly.

Pair Corralation between Kaltura and Valneva SE

Given the investment horizon of 90 days Kaltura is expected to generate 1.0 times more return on investment than Valneva SE. However, Kaltura is 1.0 times more volatile than Valneva SE ADR. It trades about 0.04 of its potential returns per unit of risk. Valneva SE ADR is currently generating about -0.01 per unit of risk. If you would invest  189.00  in Kaltura on November 20, 2024 and sell it today you would earn a total of  72.00  from holding Kaltura or generate 38.1% return on investment over 90 days.

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

Kaltura  vs.  Valneva SE ADR

Kaltura

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kaltura are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Kaltura reported solid returns over the last few months and may actually be approaching a breakup point.

Valneva SE ADR

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Valneva SE ADR are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain essential indicators, Valneva SE displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kaltura and Valneva SE

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

The idea behind Kaltura and Valneva SE ADR 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 Global Correlations module to find global opportunities by holding instruments from different markets.