Correlation Between DBV Technologies and NSE SA
Can any of the company-specific risk be diversified away by investing in both DBV Technologies and NSE SA 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 DBV Technologies and NSE SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DBV Technologies SA and NSE SA, you can compare the effects of market volatilities on DBV Technologies and NSE SA 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 DBV Technologies with a short position of NSE SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of DBV Technologies and NSE SA.
Diversification Opportunities for DBV Technologies and NSE SA
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between DBV and NSE is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding DBV Technologies SA and NSE SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NSE SA and DBV Technologies 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 DBV Technologies SA are associated (or correlated) with NSE SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NSE SA has no effect on the direction of DBV Technologies i.e., DBV Technologies and NSE SA go up and down completely randomly.
Pair Corralation between DBV Technologies and NSE SA
Assuming the 90 days trading horizon DBV Technologies SA is expected to under-perform the NSE SA. In addition to that, DBV Technologies is 5.49 times more volatile than NSE SA. It trades about -0.18 of its total potential returns per unit of risk. NSE SA is currently generating about -0.14 per unit of volatility. If you would invest 2,980 in NSE SA on August 31, 2024 and sell it today you would lose (80.00) from holding NSE SA or give up 2.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DBV Technologies SA vs. NSE SA
Performance |
| Timeline |
| DBV Technologies |
| NSE SA |
DBV Technologies and NSE SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DBV Technologies and NSE SA
The main advantage of trading using opposite DBV Technologies and NSE SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DBV Technologies position performs unexpectedly, NSE SA 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 NSE SA will offset losses from the drop in NSE SA's long position.| DBV Technologies vs. Genfit | DBV Technologies vs. Innate Pharma | DBV Technologies vs. Cellectis | DBV Technologies vs. Nanobiotix SA |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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