Correlation Between Inventiva and LianBio ADR
Can any of the company-specific risk be diversified away by investing in both Inventiva and LianBio ADR 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 LianBio ADR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inventiva Sa and LianBio ADR, you can compare the effects of market volatilities on Inventiva and LianBio ADR 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 LianBio ADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inventiva and LianBio ADR.
Diversification Opportunities for Inventiva and LianBio ADR
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Inventiva and LianBio is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Inventiva Sa and LianBio ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LianBio ADR 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 LianBio ADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LianBio ADR has no effect on the direction of Inventiva i.e., Inventiva and LianBio ADR go up and down completely randomly.
Pair Corralation between Inventiva and LianBio ADR
If you would invest 218.00 in LianBio ADR on August 28, 2024 and sell it today you would earn a total of 0.00 from holding LianBio ADR or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Inventiva Sa vs. LianBio ADR
Performance |
| Timeline |
| Inventiva Sa |
| LianBio ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Inventiva and LianBio ADR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inventiva and LianBio ADR
The main advantage of trading using opposite Inventiva and LianBio ADR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inventiva position performs unexpectedly, LianBio ADR 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 LianBio ADR will offset losses from the drop in LianBio ADR's long position.| Inventiva vs. Mineralys Therapeutics, Common | Inventiva vs. Eliem Therapeutics | Inventiva vs. Anebulo Pharmaceuticals | Inventiva vs. Janux Therapeutics |
| LianBio ADR vs. Sensei Biotherapeutics | LianBio ADR vs. NextCure | LianBio ADR vs. Nuvation Bio | LianBio ADR vs. Inozyme Pharma |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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