Correlation Between Old Dominion and Valneva SE
Can any of the company-specific risk be diversified away by investing in both Old Dominion 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 Old Dominion and Valneva SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Old Dominion Freight and Valneva SE ADR, you can compare the effects of market volatilities on Old Dominion 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 Old Dominion with a short position of Valneva SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Old Dominion and Valneva SE.
Diversification Opportunities for Old Dominion and Valneva SE
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Old and Valneva is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Old Dominion Freight 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 Old Dominion 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 Old Dominion Freight 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 Old Dominion i.e., Old Dominion and Valneva SE go up and down completely randomly.
Pair Corralation between Old Dominion and Valneva SE
Given the investment horizon of 90 days Old Dominion Freight is expected to generate 0.61 times more return on investment than Valneva SE. However, Old Dominion Freight is 1.64 times less risky than Valneva SE. It trades about 0.06 of its potential returns per unit of risk. Valneva SE ADR is currently generating about -0.07 per unit of risk. If you would invest 15,495 in Old Dominion Freight on August 31, 2024 and sell it today you would earn a total of 6,916 from holding Old Dominion Freight or generate 44.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Old Dominion Freight vs. Valneva SE ADR
Performance |
| Timeline |
| Old Dominion Freight |
| Valneva SE ADR |
Old Dominion and Valneva SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Old Dominion and Valneva SE
The main advantage of trading using opposite Old Dominion and Valneva SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Old Dominion 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.| Old Dominion vs. ArcBest Corp | Old Dominion vs. Marten Transport | Old Dominion vs. Werner Enterprises | Old Dominion vs. Knight Transportation |
| Valneva SE vs. NuCana PLC | Valneva SE vs. Sage Therapeutic | Valneva SE vs. Sellas Life Sciences | Valneva SE vs. Third Harmonic Bio |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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