Correlation Between Valneva SE and Inovio Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Valneva SE and Inovio Pharmaceuticals 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 Inovio Pharmaceuticals 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 Inovio Pharmaceuticals, you can compare the effects of market volatilities on Valneva SE and Inovio Pharmaceuticals 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 Inovio Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valneva SE and Inovio Pharmaceuticals.
Diversification Opportunities for Valneva SE and Inovio Pharmaceuticals
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Valneva and Inovio is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and Inovio Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inovio Pharmaceuticals 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 Inovio Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inovio Pharmaceuticals has no effect on the direction of Valneva SE i.e., Valneva SE and Inovio Pharmaceuticals go up and down completely randomly.
Pair Corralation between Valneva SE and Inovio Pharmaceuticals
Given the investment horizon of 90 days Valneva SE ADR is expected to under-perform the Inovio Pharmaceuticals. But the stock apears to be less risky and, when comparing its historical volatility, Valneva SE ADR is 1.51 times less risky than Inovio Pharmaceuticals. The stock trades about -0.05 of its potential returns per unit of risk. The Inovio Pharmaceuticals is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 2,076 in Inovio Pharmaceuticals on August 30, 2024 and sell it today you would lose (1,657) from holding Inovio Pharmaceuticals or give up 79.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valneva SE ADR vs. Inovio Pharmaceuticals
Performance |
| Timeline |
| Valneva SE ADR |
| Inovio Pharmaceuticals |
Valneva SE and Inovio Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valneva SE and Inovio Pharmaceuticals
The main advantage of trading using opposite Valneva SE and Inovio Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valneva SE position performs unexpectedly, Inovio Pharmaceuticals 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 Inovio Pharmaceuticals will offset losses from the drop in Inovio Pharmaceuticals' long position.| Valneva SE vs. Bright Minds Biosciences | Valneva SE vs. HP Inc | Valneva SE vs. Intel | Valneva SE vs. Chevron Corp |
| Inovio Pharmaceuticals vs. Novavax | Inovio Pharmaceuticals vs. Vaxart Inc | Inovio Pharmaceuticals vs. Enveric Biosciences | Inovio Pharmaceuticals vs. Ocean Biomedical |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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