Correlation Between Valneva SE and Marinus Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Valneva SE and Marinus 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 Marinus 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 Marinus Pharmaceuticals, you can compare the effects of market volatilities on Valneva SE and Marinus 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 Marinus Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valneva SE and Marinus Pharmaceuticals.
Diversification Opportunities for Valneva SE and Marinus Pharmaceuticals
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Valneva and Marinus is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and Marinus Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marinus 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 Marinus Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marinus Pharmaceuticals has no effect on the direction of Valneva SE i.e., Valneva SE and Marinus Pharmaceuticals go up and down completely randomly.
Pair Corralation between Valneva SE and Marinus Pharmaceuticals
Given the investment horizon of 90 days Valneva SE ADR is expected to generate 0.39 times more return on investment than Marinus Pharmaceuticals. However, Valneva SE ADR is 2.54 times less risky than Marinus Pharmaceuticals. It trades about -0.09 of its potential returns per unit of risk. Marinus Pharmaceuticals is currently generating about -0.04 per unit of risk. If you would invest 1,320 in Valneva SE ADR on September 12, 2024 and sell it today you would lose (897.50) from holding Valneva SE ADR or give up 67.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valneva SE ADR vs. Marinus Pharmaceuticals
Performance |
| Timeline |
| Valneva SE ADR |
| Marinus Pharmaceuticals |
Valneva SE and Marinus Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valneva SE and Marinus Pharmaceuticals
The main advantage of trading using opposite Valneva SE and Marinus Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valneva SE position performs unexpectedly, Marinus 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 Marinus Pharmaceuticals will offset losses from the drop in Marinus Pharmaceuticals' long position.| Valneva SE vs. NuCana PLC | Valneva SE vs. Sage Therapeutic | Valneva SE vs. Sellas Life Sciences | Valneva SE vs. Third Harmonic Bio |
| Marinus Pharmaceuticals vs. Equillium | Marinus Pharmaceuticals vs. DiaMedica Therapeutics | Marinus Pharmaceuticals vs. Valneva SE ADR | Marinus Pharmaceuticals vs. Vivani Medical |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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