Correlation Between PGE Corp and Valneva SE
Can any of the company-specific risk be diversified away by investing in both PGE Corp 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 PGE Corp and Valneva SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PGE Corp and Valneva SE ADR, you can compare the effects of market volatilities on PGE Corp 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 PGE Corp with a short position of Valneva SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of PGE Corp and Valneva SE.
Diversification Opportunities for PGE Corp and Valneva SE
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PGE and Valneva is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding PGE Corp 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 PGE Corp 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 PGE Corp 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 PGE Corp i.e., PGE Corp and Valneva SE go up and down completely randomly.
Pair Corralation between PGE Corp and Valneva SE
Considering the 90-day investment horizon PGE Corp is expected to generate 0.36 times more return on investment than Valneva SE. However, PGE Corp is 2.78 times less risky than Valneva SE. It trades about 0.01 of its potential returns per unit of risk. Valneva SE ADR is currently generating about 0.0 per unit of risk. If you would invest 1,579 in PGE Corp on November 21, 2024 and sell it today you would lose (13.00) from holding PGE Corp or give up 0.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PGE Corp vs. Valneva SE ADR
Performance |
| Timeline |
| PGE Corp |
| Valneva SE ADR |
PGE Corp and Valneva SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PGE Corp and Valneva SE
The main advantage of trading using opposite PGE Corp and Valneva SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PGE Corp 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.| PGE Corp vs. Consolidated Edison | PGE Corp vs. Southern Company | PGE Corp vs. Entergy | PGE Corp vs. Pinnacle West Capital |
| 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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