Correlation Between Valneva SE and 446150AV6

Can any of the company-specific risk be diversified away by investing in both Valneva SE and 446150AV6 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 446150AV6 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 HBAN 445, you can compare the effects of market volatilities on Valneva SE and 446150AV6 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 446150AV6. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valneva SE and 446150AV6.

Diversification Opportunities for Valneva SE and 446150AV6

0.55

Correlation Coefficient

Valneva SE  446150AV6

Very weak diversification

The 3 months correlation between Valneva and 446150AV6 is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and HBAN 445 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 446150AV6 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 446150AV6. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 446150AV6 has no effect on the direction of Valneva SE i.e., Valneva SE and 446150AV6 go up and down completely randomly.

Pair Corralation between Valneva SE and 446150AV6

Given the investment horizon of 90 days Valneva SE ADR is expected to under-perform the 446150AV6. In addition to that, Valneva SE is 1.83 times more volatile than HBAN 445. It trades about -0.09 of its total potential returns per unit of risk. HBAN 445 is currently generating about 0.03 per unit of volatility. If you would invest  8,449  in HBAN 445 on September 23, 2024 and sell it today you would earn a total of  1,163  from holding HBAN 445 or generate 13.76% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.89%
Values	Daily Returns

Valneva SE ADR  vs.  HBAN 445

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 unsteady performance in the last few months, the Stock's essential indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

446150AV6

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in HBAN 445 are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, 446150AV6 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Valneva SE and 446150AV6

The main advantage of trading using opposite Valneva SE and 446150AV6 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valneva SE position performs unexpectedly, 446150AV6 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 446150AV6 will offset losses from the drop in 446150AV6's long position.

The idea behind Valneva SE ADR and HBAN 445 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.