Correlation Between Electrovaya Common and Valneva SE
Can any of the company-specific risk be diversified away by investing in both Electrovaya Common 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 Electrovaya Common and Valneva SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electrovaya Common Shares and Valneva SE ADR, you can compare the effects of market volatilities on Electrovaya Common 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 Electrovaya Common with a short position of Valneva SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electrovaya Common and Valneva SE.
Diversification Opportunities for Electrovaya Common and Valneva SE
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Electrovaya and Valneva is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Electrovaya Common Shares 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 Electrovaya Common 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 Electrovaya Common Shares 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 Electrovaya Common i.e., Electrovaya Common and Valneva SE go up and down completely randomly.
Pair Corralation between Electrovaya Common and Valneva SE
Given the investment horizon of 90 days Electrovaya Common Shares is expected to generate 1.71 times more return on investment than Valneva SE. However, Electrovaya Common is 1.71 times more volatile than Valneva SE ADR. It trades about 0.28 of its potential returns per unit of risk. Valneva SE ADR is currently generating about -0.58 per unit of risk. If you would invest 210.00 in Electrovaya Common Shares on August 28, 2024 and sell it today you would earn a total of 62.00 from holding Electrovaya Common Shares or generate 29.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Electrovaya Common Shares vs. Valneva SE ADR
Performance |
| Timeline |
| Electrovaya Common Shares |
| Valneva SE ADR |
Electrovaya Common and Valneva SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electrovaya Common and Valneva SE
The main advantage of trading using opposite Electrovaya Common and Valneva SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electrovaya Common 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.| Electrovaya Common vs. Bloom Energy Corp | Electrovaya Common vs. Eos Energy Enterprises | Electrovaya Common vs. Sunrise New Energy | Electrovaya Common vs. Flux Power Holdings |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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