Correlation Between Inventiva and Connect Biopharma
Can any of the company-specific risk be diversified away by investing in both Inventiva and Connect Biopharma 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 Inventiva and Connect Biopharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inventiva Sa and Connect Biopharma Holdings, you can compare the effects of market volatilities on Inventiva and Connect Biopharma 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 Inventiva with a short position of Connect Biopharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inventiva and Connect Biopharma.
Diversification Opportunities for Inventiva and Connect Biopharma
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Inventiva and Connect is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Inventiva Sa and Connect Biopharma Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Connect Biopharma and Inventiva 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 Inventiva Sa are associated (or correlated) with Connect Biopharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Connect Biopharma has no effect on the direction of Inventiva i.e., Inventiva and Connect Biopharma go up and down completely randomly.
Pair Corralation between Inventiva and Connect Biopharma
Considering the 90-day investment horizon Inventiva Sa is expected to generate 0.44 times more return on investment than Connect Biopharma. However, Inventiva Sa is 2.29 times less risky than Connect Biopharma. It trades about -0.02 of its potential returns per unit of risk. Connect Biopharma Holdings is currently generating about -0.23 per unit of risk. If you would invest 271.00 in Inventiva Sa on August 28, 2024 and sell it today you would lose (4.00) from holding Inventiva Sa or give up 1.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inventiva Sa vs. Connect Biopharma Holdings
Performance |
| Timeline |
| Inventiva Sa |
| Connect Biopharma |
Inventiva and Connect Biopharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inventiva and Connect Biopharma
The main advantage of trading using opposite Inventiva and Connect Biopharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inventiva position performs unexpectedly, Connect Biopharma 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 Connect Biopharma will offset losses from the drop in Connect Biopharma's long position.| Inventiva vs. Mineralys Therapeutics, Common | Inventiva vs. Eliem Therapeutics | Inventiva vs. Anebulo Pharmaceuticals | Inventiva vs. Janux Therapeutics |
| Connect Biopharma vs. Assembly Biosciences | Connect Biopharma vs. Instil Bio | Connect Biopharma vs. CytomX Therapeutics | Connect Biopharma vs. Achilles Therapeutics PLC |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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