Correlation Between Valneva SE and AquaBounty Technologies
Can any of the company-specific risk be diversified away by investing in both Valneva SE and AquaBounty Technologies 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 Valneva SE and AquaBounty Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Valneva SE ADR and AquaBounty Technologies, you can compare the effects of market volatilities on Valneva SE and AquaBounty Technologies 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 Valneva SE with a short position of AquaBounty Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valneva SE and AquaBounty Technologies.
Diversification Opportunities for Valneva SE and AquaBounty Technologies
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Valneva and AquaBounty is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and AquaBounty Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AquaBounty Technologies and Valneva SE 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 Valneva SE ADR are associated (or correlated) with AquaBounty Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AquaBounty Technologies has no effect on the direction of Valneva SE i.e., Valneva SE and AquaBounty Technologies go up and down completely randomly.
Pair Corralation between Valneva SE and AquaBounty Technologies
Given the investment horizon of 90 days Valneva SE ADR is expected to generate 0.52 times more return on investment than AquaBounty Technologies. However, Valneva SE ADR is 1.93 times less risky than AquaBounty Technologies. It trades about 0.35 of its potential returns per unit of risk. AquaBounty Technologies is currently generating about -0.07 per unit of risk. If you would invest 469.00 in Valneva SE ADR on November 5, 2024 and sell it today you would earn a total of 109.00 from holding Valneva SE ADR or generate 23.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valneva SE ADR vs. AquaBounty Technologies
Performance |
| Timeline |
| Valneva SE ADR |
| AquaBounty Technologies |
Valneva SE and AquaBounty Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valneva SE and AquaBounty Technologies
The main advantage of trading using opposite Valneva SE and AquaBounty Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valneva SE position performs unexpectedly, AquaBounty Technologies 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 AquaBounty Technologies will offset losses from the drop in AquaBounty Technologies' long position.| Valneva SE vs. NuCana PLC | Valneva SE vs. Sage Therapeutic | Valneva SE vs. Sellas Life Sciences | Valneva SE vs. Third Harmonic Bio |
| AquaBounty Technologies vs. Atlantic Sapphire ASA | AquaBounty Technologies vs. Adecoagro SA | AquaBounty Technologies vs. Local Bounti Corp | AquaBounty Technologies vs. Forafric Global PLC |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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