Correlation Between Monte Rosa and Inventiva
Can any of the company-specific risk be diversified away by investing in both Monte Rosa and Inventiva 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 Monte Rosa and Inventiva into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monte Rosa Therapeutics and Inventiva Sa, you can compare the effects of market volatilities on Monte Rosa and Inventiva 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 Monte Rosa with a short position of Inventiva. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monte Rosa and Inventiva.
Diversification Opportunities for Monte Rosa and Inventiva
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Monte and Inventiva is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Monte Rosa Therapeutics and Inventiva Sa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inventiva Sa and Monte Rosa 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 Monte Rosa Therapeutics are associated (or correlated) with Inventiva. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inventiva Sa has no effect on the direction of Monte Rosa i.e., Monte Rosa and Inventiva go up and down completely randomly.
Pair Corralation between Monte Rosa and Inventiva
Given the investment horizon of 90 days Monte Rosa Therapeutics is expected to under-perform the Inventiva. In addition to that, Monte Rosa is 1.09 times more volatile than Inventiva Sa. It trades about -0.05 of its total potential returns per unit of risk. Inventiva Sa is currently generating about 0.15 per unit of volatility. If you would invest 216.00 in Inventiva Sa on November 4, 2024 and sell it today you would earn a total of 26.00 from holding Inventiva Sa or generate 12.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Monte Rosa Therapeutics vs. Inventiva Sa
Performance |
| Timeline |
| Monte Rosa Therapeutics |
| Inventiva Sa |
Monte Rosa and Inventiva Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monte Rosa and Inventiva
The main advantage of trading using opposite Monte Rosa and Inventiva positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monte Rosa position performs unexpectedly, Inventiva 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 Inventiva will offset losses from the drop in Inventiva's long position.| Monte Rosa vs. Nkarta Inc | Monte Rosa vs. Lyell Immunopharma | Monte Rosa vs. Generation Bio Co | Monte Rosa vs. Sana Biotechnology |
| Inventiva vs. Mineralys Therapeutics, Common | Inventiva vs. Anebulo Pharmaceuticals | Inventiva vs. Janux Therapeutics | Inventiva vs. Rezolute |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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