Correlation Between East Africa and Valneva SE
Can any of the company-specific risk be diversified away by investing in both East Africa 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 East Africa and Valneva SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between East Africa Metals and Valneva SE ADR, you can compare the effects of market volatilities on East Africa 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 East Africa with a short position of Valneva SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of East Africa and Valneva SE.
Diversification Opportunities for East Africa and Valneva SE
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between East and Valneva is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding East Africa Metals 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 East Africa 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 East Africa Metals 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 East Africa i.e., East Africa and Valneva SE go up and down completely randomly.
Pair Corralation between East Africa and Valneva SE
Assuming the 90 days horizon East Africa Metals is expected to generate 16.59 times more return on investment than Valneva SE. However, East Africa is 16.59 times more volatile than Valneva SE ADR. It trades about 0.08 of its potential returns per unit of risk. Valneva SE ADR is currently generating about -0.02 per unit of risk. If you would invest 9.89 in East Africa Metals on November 5, 2024 and sell it today you would earn a total of 1.11 from holding East Africa Metals or generate 11.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.4% |
| Values | Daily Returns |
East Africa Metals vs. Valneva SE ADR
Performance |
| Timeline |
| East Africa Metals |
| Valneva SE ADR |
East Africa and Valneva SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with East Africa and Valneva SE
The main advantage of trading using opposite East Africa and Valneva SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if East Africa 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.| East Africa vs. Pasinex Resources Limited | East Africa vs. Commander Resources | East Africa vs. Forsys Metals Corp | East Africa vs. American CuMo Mining |
| 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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