Correlation Between Valneva SE and NextTrip
Can any of the company-specific risk be diversified away by investing in both Valneva SE and NextTrip 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 NextTrip 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 NextTrip, you can compare the effects of market volatilities on Valneva SE and NextTrip 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 NextTrip. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valneva SE and NextTrip.
Diversification Opportunities for Valneva SE and NextTrip
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Valneva and NextTrip is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and NextTrip in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NextTrip 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 NextTrip. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NextTrip has no effect on the direction of Valneva SE i.e., Valneva SE and NextTrip go up and down completely randomly.
Pair Corralation between Valneva SE and NextTrip
Given the investment horizon of 90 days Valneva SE ADR is expected to under-perform the NextTrip. But the stock apears to be less risky and, when comparing its historical volatility, Valneva SE ADR is 5.14 times less risky than NextTrip. The stock trades about -0.53 of its potential returns per unit of risk. The NextTrip is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 185.00 in NextTrip on September 2, 2024 and sell it today you would earn a total of 197.00 from holding NextTrip or generate 106.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valneva SE ADR vs. NextTrip
Performance |
| Timeline |
| Valneva SE ADR |
| NextTrip |
Valneva SE and NextTrip Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valneva SE and NextTrip
The main advantage of trading using opposite Valneva SE and NextTrip positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valneva SE position performs unexpectedly, NextTrip 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 NextTrip will offset losses from the drop in NextTrip's long position.| Valneva SE vs. Tff Pharmaceuticals | Valneva SE vs. Eliem Therapeutics | Valneva SE vs. Inhibrx | Valneva SE vs. Enliven Therapeutics |
| NextTrip vs. Arrow Electronics | NextTrip vs. Meiwu Technology Co | NextTrip vs. Everspin Technologies | NextTrip vs. IPG Photonics |
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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