Correlation Between Valneva SE and Champions Oncology
Can any of the company-specific risk be diversified away by investing in both Valneva SE and Champions Oncology 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 Champions Oncology 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 Champions Oncology, you can compare the effects of market volatilities on Valneva SE and Champions Oncology 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 Champions Oncology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valneva SE and Champions Oncology.
Diversification Opportunities for Valneva SE and Champions Oncology
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Valneva and Champions is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and Champions Oncology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Champions Oncology 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 Champions Oncology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Champions Oncology has no effect on the direction of Valneva SE i.e., Valneva SE and Champions Oncology go up and down completely randomly.
Pair Corralation between Valneva SE and Champions Oncology
Given the investment horizon of 90 days Valneva SE is expected to generate 3.22 times less return on investment than Champions Oncology. But when comparing it to its historical volatility, Valneva SE ADR is 2.17 times less risky than Champions Oncology. It trades about 0.2 of its potential returns per unit of risk. Champions Oncology is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 787.00 in Champions Oncology on October 25, 2024 and sell it today you would earn a total of 285.00 from holding Champions Oncology or generate 36.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valneva SE ADR vs. Champions Oncology
Performance |
| Timeline |
| Valneva SE ADR |
| Champions Oncology |
Valneva SE and Champions Oncology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valneva SE and Champions Oncology
The main advantage of trading using opposite Valneva SE and Champions Oncology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valneva SE position performs unexpectedly, Champions Oncology 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 Champions Oncology will offset losses from the drop in Champions Oncology'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 |
| Champions Oncology vs. Molecular Partners AG | Champions Oncology vs. MediciNova | Champions Oncology vs. Anebulo Pharmaceuticals | Champions Oncology vs. Shattuck Labs |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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