Correlation Between Valneva SE and BCE
Can any of the company-specific risk be diversified away by investing in both Valneva SE and BCE 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 BCE 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 BCE Inc, you can compare the effects of market volatilities on Valneva SE and BCE 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 BCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valneva SE and BCE.
Diversification Opportunities for Valneva SE and BCE
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Valneva and BCE is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and BCE Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BCE Inc 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 BCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BCE Inc has no effect on the direction of Valneva SE i.e., Valneva SE and BCE go up and down completely randomly.
Pair Corralation between Valneva SE and BCE
Given the investment horizon of 90 days Valneva SE ADR is expected to generate 3.28 times more return on investment than BCE. However, Valneva SE is 3.28 times more volatile than BCE Inc. It trades about 0.0 of its potential returns per unit of risk. BCE Inc is currently generating about -0.07 per unit of risk. If you would invest 1,149 in Valneva SE ADR on November 28, 2024 and sell it today you would lose (402.00) from holding Valneva SE ADR or give up 34.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Valneva SE ADR vs. BCE Inc
Performance |
| Timeline |
| Valneva SE ADR |
| BCE Inc |
Valneva SE and BCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valneva SE and BCE
The main advantage of trading using opposite Valneva SE and BCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valneva SE position performs unexpectedly, BCE 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 BCE will offset losses from the drop in BCE's long position.| Valneva SE vs. NuCana PLC | Valneva SE vs. Sage Therapeutic | Valneva SE vs. Sellas Life Sciences | Valneva SE vs. Third Harmonic Bio |
| BCE vs. Rogers Communications | BCE vs. America Movil SAB | BCE vs. Telus Corp | BCE vs. Telefonica Brasil SA |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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