Correlation Between Valneva SE and Graham Holdings

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

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

Diversification Opportunities for Valneva SE and Graham Holdings

-0.74

Correlation Coefficient

Valneva SE  Graham Holdings

Pay attention - limited upside

The 3 months correlation between Valneva and Graham is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and Graham Holdings Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graham Holdings and Valneva SE 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 Valneva SE ADR are associated (or correlated) with Graham Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graham Holdings has no effect on the direction of Valneva SE i.e., Valneva SE and Graham Holdings go up and down completely randomly.

Pair Corralation between Valneva SE and Graham Holdings

Given the investment horizon of 90 days Valneva SE ADR is expected to under-perform the Graham Holdings. In addition to that, Valneva SE is 1.66 times more volatile than Graham Holdings Co. It trades about -0.07 of its total potential returns per unit of risk. Graham Holdings Co is currently generating about 0.07 per unit of volatility. If you would invest  79,326  in Graham Holdings Co on October 10, 2024 and sell it today you would earn a total of  6,805  from holding Graham Holdings Co or generate 8.58% return on investment over 90 days.

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

Valneva SE ADR  vs.  Graham Holdings Co

Valneva SE ADR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Valneva SE ADR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's essential indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Graham Holdings

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Graham Holdings Co are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating technical indicators, Graham Holdings may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Valneva SE and Graham Holdings

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

The idea behind Valneva SE ADR and Graham Holdings Co 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.