Correlation Between Cumulus Media and Valneva SE
Can any of the company-specific risk be diversified away by investing in both Cumulus Media 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 Cumulus Media and Valneva SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cumulus Media Class and Valneva SE ADR, you can compare the effects of market volatilities on Cumulus Media 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 Cumulus Media with a short position of Valneva SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cumulus Media and Valneva SE.
Diversification Opportunities for Cumulus Media and Valneva SE
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cumulus and Valneva is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Cumulus Media Class 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 Cumulus Media 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 Cumulus Media Class 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 Cumulus Media i.e., Cumulus Media and Valneva SE go up and down completely randomly.
Pair Corralation between Cumulus Media and Valneva SE
Given the investment horizon of 90 days Cumulus Media Class is expected to under-perform the Valneva SE. In addition to that, Cumulus Media is 2.13 times more volatile than Valneva SE ADR. It trades about -0.26 of its total potential returns per unit of risk. Valneva SE ADR is currently generating about -0.49 per unit of volatility. If you would invest 565.00 in Valneva SE ADR on September 1, 2024 and sell it today you would lose (160.00) from holding Valneva SE ADR or give up 28.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cumulus Media Class vs. Valneva SE ADR
Performance |
| Timeline |
| Cumulus Media Class |
| Valneva SE ADR |
Cumulus Media and Valneva SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cumulus Media and Valneva SE
The main advantage of trading using opposite Cumulus Media and Valneva SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cumulus Media 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.| Cumulus Media vs. E W Scripps | Cumulus Media vs. Gray Television | Cumulus Media vs. ProSiebenSat1 Media AG | Cumulus Media vs. RTL Group SA |
| 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 Positions Ratings module to 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.
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