Correlation Between Kezar Life and Valneva SE
Can any of the company-specific risk be diversified away by investing in both Kezar Life 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 Kezar Life and Valneva SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kezar Life Sciences and Valneva SE ADR, you can compare the effects of market volatilities on Kezar Life 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 Kezar Life with a short position of Valneva SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kezar Life and Valneva SE.
Diversification Opportunities for Kezar Life and Valneva SE
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kezar and Valneva is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Kezar Life Sciences 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 Kezar Life 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 Kezar Life Sciences 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 Kezar Life i.e., Kezar Life and Valneva SE go up and down completely randomly.
Pair Corralation between Kezar Life and Valneva SE
Considering the 90-day investment horizon Kezar Life Sciences is expected to generate 1.18 times more return on investment than Valneva SE. However, Kezar Life is 1.18 times more volatile than Valneva SE ADR. It trades about -0.03 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 773.00 in Kezar Life Sciences on August 28, 2024 and sell it today you would lose (26.00) from holding Kezar Life Sciences or give up 3.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kezar Life Sciences vs. Valneva SE ADR
Performance |
| Timeline |
| Kezar Life Sciences |
| Valneva SE ADR |
Kezar Life and Valneva SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kezar Life and Valneva SE
The main advantage of trading using opposite Kezar Life and Valneva SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kezar Life 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.| Kezar Life vs. Eliem Therapeutics | Kezar Life vs. HCW Biologics | Kezar Life vs. Scpharmaceuticals | Kezar Life vs. Milestone Pharmaceuticals |
| 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.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |