Correlation Between Jacobs Solutions and Valneva SE
Can any of the company-specific risk be diversified away by investing in both Jacobs Solutions 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 Jacobs Solutions and Valneva SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacobs Solutions and Valneva SE ADR, you can compare the effects of market volatilities on Jacobs Solutions 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 Jacobs Solutions with a short position of Valneva SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacobs Solutions and Valneva SE.
Diversification Opportunities for Jacobs Solutions and Valneva SE
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Jacobs and Valneva is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Jacobs Solutions 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 Jacobs Solutions 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 Jacobs Solutions 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 Jacobs Solutions i.e., Jacobs Solutions and Valneva SE go up and down completely randomly.
Pair Corralation between Jacobs Solutions and Valneva SE
Taking into account the 90-day investment horizon Jacobs Solutions is expected to generate 0.8 times more return on investment than Valneva SE. However, Jacobs Solutions is 1.25 times less risky than Valneva SE. It trades about -0.02 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 14,120 in Jacobs Solutions on August 28, 2024 and sell it today you would lose (190.00) from holding Jacobs Solutions or give up 1.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jacobs Solutions vs. Valneva SE ADR
Performance |
| Timeline |
| Jacobs Solutions |
| Valneva SE ADR |
Jacobs Solutions and Valneva SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacobs Solutions and Valneva SE
The main advantage of trading using opposite Jacobs Solutions and Valneva SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacobs Solutions 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.| Jacobs Solutions vs. Innovate Corp | Jacobs Solutions vs. Energy Services | Jacobs Solutions vs. Api Group Corp | Jacobs Solutions vs. Topbuild Corp |
| Valneva SE vs. Eliem Therapeutics | Valneva SE vs. HCW Biologics | Valneva SE vs. Scpharmaceuticals | Valneva SE vs. Milestone Pharmaceuticals |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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