Correlation Between Aegean Airlines and Valneva SE
Can any of the company-specific risk be diversified away by investing in both Aegean Airlines 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 Aegean Airlines and Valneva SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aegean Airlines SA and Valneva SE ADR, you can compare the effects of market volatilities on Aegean Airlines 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 Aegean Airlines with a short position of Valneva SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegean Airlines and Valneva SE.
Diversification Opportunities for Aegean Airlines and Valneva SE
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aegean and Valneva is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Aegean Airlines SA 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 Aegean Airlines 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 Aegean Airlines SA 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 Aegean Airlines i.e., Aegean Airlines and Valneva SE go up and down completely randomly.
Pair Corralation between Aegean Airlines and Valneva SE
Assuming the 90 days horizon Aegean Airlines SA is expected to generate 0.4 times more return on investment than Valneva SE. However, Aegean Airlines SA is 2.49 times less risky than Valneva SE. It trades about -0.08 of its potential returns per unit of risk. Valneva SE ADR is currently generating about -0.14 per unit of risk. If you would invest 1,250 in Aegean Airlines SA on September 13, 2024 and sell it today you would lose (165.00) from holding Aegean Airlines SA or give up 13.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aegean Airlines SA vs. Valneva SE ADR
Performance |
| Timeline |
| Aegean Airlines SA |
| Valneva SE ADR |
Aegean Airlines and Valneva SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegean Airlines and Valneva SE
The main advantage of trading using opposite Aegean Airlines and Valneva SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegean Airlines 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.| Aegean Airlines vs. Copa Holdings SA | Aegean Airlines vs. United Airlines Holdings | Aegean Airlines vs. Delta Air Lines | Aegean Airlines vs. SkyWest |
| Valneva SE vs. NuCana PLC | Valneva SE vs. Sage Therapeutic | Valneva SE vs. Sellas Life Sciences | Valneva SE vs. Third Harmonic Bio |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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