Correlation Between Valneva SE and Lifecore Biomedical
Can any of the company-specific risk be diversified away by investing in both Valneva SE and Lifecore Biomedical 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 Lifecore Biomedical 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 Lifecore Biomedical, you can compare the effects of market volatilities on Valneva SE and Lifecore Biomedical 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 Lifecore Biomedical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valneva SE and Lifecore Biomedical.
Diversification Opportunities for Valneva SE and Lifecore Biomedical
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Valneva and Lifecore is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and Lifecore Biomedical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifecore Biomedical 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 Lifecore Biomedical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifecore Biomedical has no effect on the direction of Valneva SE i.e., Valneva SE and Lifecore Biomedical go up and down completely randomly.
Pair Corralation between Valneva SE and Lifecore Biomedical
Given the investment horizon of 90 days Valneva SE ADR is expected to under-perform the Lifecore Biomedical. But the stock apears to be less risky and, when comparing its historical volatility, Valneva SE ADR is 1.66 times less risky than Lifecore Biomedical. The stock trades about -0.35 of its potential returns per unit of risk. The Lifecore Biomedical is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 493.00 in Lifecore Biomedical on August 31, 2024 and sell it today you would earn a total of 257.00 from holding Lifecore Biomedical or generate 52.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valneva SE ADR vs. Lifecore Biomedical
Performance |
| Timeline |
| Valneva SE ADR |
| Lifecore Biomedical |
Valneva SE and Lifecore Biomedical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valneva SE and Lifecore Biomedical
The main advantage of trading using opposite Valneva SE and Lifecore Biomedical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valneva SE position performs unexpectedly, Lifecore Biomedical 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 Lifecore Biomedical will offset losses from the drop in Lifecore Biomedical'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 |
| Lifecore Biomedical vs. Bausch Health Companies | Lifecore Biomedical vs. Haleon plc | Lifecore Biomedical vs. Intracellular Th |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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