Correlation Between Valneva SE and United Homes
Can any of the company-specific risk be diversified away by investing in both Valneva SE and United Homes 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 United Homes 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 United Homes Group, you can compare the effects of market volatilities on Valneva SE and United Homes 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 United Homes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valneva SE and United Homes.
Diversification Opportunities for Valneva SE and United Homes
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Valneva and United is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and United Homes Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Homes Group 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 United Homes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Homes Group has no effect on the direction of Valneva SE i.e., Valneva SE and United Homes go up and down completely randomly.
Pair Corralation between Valneva SE and United Homes
Given the investment horizon of 90 days Valneva SE ADR is expected to generate 0.89 times more return on investment than United Homes. However, Valneva SE ADR is 1.12 times less risky than United Homes. It trades about -0.03 of its potential returns per unit of risk. United Homes Group is currently generating about -0.05 per unit of risk. If you would invest 1,320 in Valneva SE ADR on January 10, 2025 and sell it today you would lose (689.00) from holding Valneva SE ADR or give up 52.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valneva SE ADR vs. United Homes Group
Performance |
| Timeline |
| Valneva SE ADR |
| United Homes Group |
Valneva SE and United Homes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valneva SE and United Homes
The main advantage of trading using opposite Valneva SE and United Homes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valneva SE position performs unexpectedly, United Homes 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 United Homes will offset losses from the drop in United Homes' long position.| Valneva SE vs. NuCana PLC | Valneva SE vs. Sage Therapeutic | Valneva SE vs. Sellas Life Sciences | Valneva SE vs. Third Harmonic Bio |
| United Homes vs. Harmony Gold Mining | United Homes vs. Chester Mining | United Homes vs. Paiute Oil Mining | United Homes vs. Perseus Mining Limited |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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