Correlation Between 909319AA3 and Valneva SE

Can any of the company-specific risk be diversified away by investing in both 909319AA3 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 909319AA3 and Valneva SE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between US909319AA30 and Valneva SE ADR, you can compare the effects of market volatilities on 909319AA3 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 909319AA3 with a short position of Valneva SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of 909319AA3 and Valneva SE.

Diversification Opportunities for 909319AA3 and Valneva SE

0.15

Correlation Coefficient

909319AA3  Valneva SE

Average diversification

The 3 months correlation between 909319AA3 and Valneva is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding US909319AA30 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 909319AA3 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 US909319AA30 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 909319AA3 i.e., 909319AA3 and Valneva SE go up and down completely randomly.

Pair Corralation between 909319AA3 and Valneva SE

Assuming the 90 days trading horizon US909319AA30 is expected to under-perform the Valneva SE. But the bond apears to be less risky and, when comparing its historical volatility, US909319AA30 is 5.1 times less risky than Valneva SE. The bond trades about -0.05 of its potential returns per unit of risk. The Valneva SE ADR is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  419.00  in Valneva SE ADR on December 24, 2024 and sell it today you would earn a total of  352.00  from holding Valneva SE ADR or generate 84.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	54.1%
Values	Daily Returns

US909319AA30  vs.  Valneva SE ADR

US909319AA30

Risk-Adjusted Performance

Very Weak

Over the last 90 days US909319AA30 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 909319AA3 is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Valneva SE ADR

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Valneva SE ADR are ranked lower than 17 (%) 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 909319AA3 and Valneva SE

The main advantage of trading using opposite 909319AA3 and Valneva SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 909319AA3 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 US909319AA30 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.