Correlation Between Valneva SE and Nexalin Technology
Can any of the company-specific risk be diversified away by investing in both Valneva SE and Nexalin Technology 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 Nexalin Technology 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 Nexalin Technology, you can compare the effects of market volatilities on Valneva SE and Nexalin Technology 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 Nexalin Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valneva SE and Nexalin Technology.
Diversification Opportunities for Valneva SE and Nexalin Technology
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Valneva and Nexalin is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and Nexalin Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nexalin Technology 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 Nexalin Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nexalin Technology has no effect on the direction of Valneva SE i.e., Valneva SE and Nexalin Technology go up and down completely randomly.
Pair Corralation between Valneva SE and Nexalin Technology
Given the investment horizon of 90 days Valneva SE ADR is expected to under-perform the Nexalin Technology. But the stock apears to be less risky and, when comparing its historical volatility, Valneva SE ADR is 38.37 times less risky than Nexalin Technology. The stock trades about -0.07 of its potential returns per unit of risk. The Nexalin Technology is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 9.97 in Nexalin Technology on August 31, 2024 and sell it today you would earn a total of 31.03 from holding Nexalin Technology or generate 311.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 59.9% |
| Values | Daily Returns |
Valneva SE ADR vs. Nexalin Technology
Performance |
| Timeline |
| Valneva SE ADR |
| Nexalin Technology |
Valneva SE and Nexalin Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valneva SE and Nexalin Technology
The main advantage of trading using opposite Valneva SE and Nexalin Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valneva SE position performs unexpectedly, Nexalin Technology 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 Nexalin Technology will offset losses from the drop in Nexalin Technology'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 |
| Nexalin Technology vs. NexGel Warrant | Nexalin Technology vs. NLS Pharmaceutics AG | Nexalin Technology vs. Inspira Technologies Oxy |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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