Correlation Between Valneva SE and Wendys
Can any of the company-specific risk be diversified away by investing in both Valneva SE and Wendys 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 Wendys 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 The Wendys Co, you can compare the effects of market volatilities on Valneva SE and Wendys 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 Wendys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valneva SE and Wendys.
Diversification Opportunities for Valneva SE and Wendys
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Valneva and Wendys is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and The Wendys Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Wendys 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 Wendys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Wendys has no effect on the direction of Valneva SE i.e., Valneva SE and Wendys go up and down completely randomly.
Pair Corralation between Valneva SE and Wendys
Given the investment horizon of 90 days Valneva SE ADR is expected to under-perform the Wendys. In addition to that, Valneva SE is 1.98 times more volatile than The Wendys Co. It trades about -0.06 of its total potential returns per unit of risk. The Wendys Co is currently generating about 0.02 per unit of volatility. If you would invest 1,734 in The Wendys Co on August 25, 2024 and sell it today you would earn a total of 64.00 from holding The Wendys Co or generate 3.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valneva SE ADR vs. The Wendys Co
Performance |
| Timeline |
| Valneva SE ADR |
| The Wendys |
Valneva SE and Wendys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valneva SE and Wendys
The main advantage of trading using opposite Valneva SE and Wendys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valneva SE position performs unexpectedly, Wendys 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 Wendys will offset losses from the drop in Wendys' long position.| Valneva SE vs. Eliem Therapeutics | Valneva SE vs. HCW Biologics | Valneva SE vs. Scpharmaceuticals | Valneva SE vs. Milestone Pharmaceuticals |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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