Correlation Between American Axle and Valneva SE
Can any of the company-specific risk be diversified away by investing in both American Axle 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 American Axle and Valneva SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Axle Manufacturing and Valneva SE ADR, you can compare the effects of market volatilities on American Axle 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 American Axle with a short position of Valneva SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Axle and Valneva SE.
Diversification Opportunities for American Axle and Valneva SE
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and Valneva is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding American Axle Manufacturing 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 American Axle 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 Axle Manufacturing 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 American Axle i.e., American Axle and Valneva SE go up and down completely randomly.
Pair Corralation between American Axle and Valneva SE
Considering the 90-day investment horizon American Axle Manufacturing is expected to generate 0.77 times more return on investment than Valneva SE. However, American Axle Manufacturing is 1.31 times less risky than Valneva SE. It trades about 0.0 of its potential returns per unit of risk. Valneva SE ADR is currently generating about -0.11 per unit of risk. If you would invest 720.00 in American Axle Manufacturing on September 14, 2024 and sell it today you would lose (59.00) from holding American Axle Manufacturing or give up 8.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Axle Manufacturing vs. Valneva SE ADR
Performance |
| Timeline |
| American Axle Manufa |
| Valneva SE ADR |
American Axle and Valneva SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Axle and Valneva SE
The main advantage of trading using opposite American Axle and Valneva SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Axle 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.| American Axle vs. Ford Motor | American Axle vs. General Motors | American Axle vs. Goodyear Tire Rubber | American Axle vs. Li Auto |
| 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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |