Correlation Between American Clean and Inventiva
Can any of the company-specific risk be diversified away by investing in both American Clean and Inventiva 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 American Clean and Inventiva into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Clean Resources and Inventiva SA, you can compare the effects of market volatilities on American Clean and Inventiva 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 American Clean with a short position of Inventiva. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Clean and Inventiva.
Diversification Opportunities for American Clean and Inventiva
-1.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and Inventiva is -1.0. Overlapping area represents the amount of risk that can be diversified away by holding American Clean Resources and Inventiva SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inventiva SA and American Clean 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 American Clean Resources are associated (or correlated) with Inventiva. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inventiva SA has no effect on the direction of American Clean i.e., American Clean and Inventiva go up and down completely randomly.
Pair Corralation between American Clean and Inventiva
Given the investment horizon of 90 days American Clean Resources is expected to generate 9.33 times more return on investment than Inventiva. However, American Clean is 9.33 times more volatile than Inventiva SA. It trades about 0.05 of its potential returns per unit of risk. Inventiva SA is currently generating about -0.05 per unit of risk. If you would invest 326.00 in American Clean Resources on November 7, 2024 and sell it today you would earn a total of 179.00 from holding American Clean Resources or generate 54.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Clean Resources vs. Inventiva SA
Performance |
| Timeline |
| American Clean Resources |
| Inventiva SA |
American Clean and Inventiva Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Clean and Inventiva
The main advantage of trading using opposite American Clean and Inventiva positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Clean position performs unexpectedly, Inventiva 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 Inventiva will offset losses from the drop in Inventiva's long position.| American Clean vs. Gold79 Mines | American Clean vs. Arctic Star Exploration | American Clean vs. Arras Minerals Corp | American Clean vs. American Creek Resources |
| Inventiva vs. Sino Biopharmaceutical Ltd | Inventiva vs. Defence Therapeutics | Inventiva vs. Enlivex Therapeutics | Inventiva vs. Living Cell Technologies |
Check out your portfolio center.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.
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