Correlation Between Valeura Energy and Genfit
Can any of the company-specific risk be diversified away by investing in both Valeura Energy and Genfit 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 Valeura Energy and Genfit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Valeura Energy and Genfit, you can compare the effects of market volatilities on Valeura Energy and Genfit 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 Valeura Energy with a short position of Genfit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valeura Energy and Genfit.
Diversification Opportunities for Valeura Energy and Genfit
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Valeura and Genfit is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Valeura Energy and Genfit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genfit and Valeura Energy 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 Valeura Energy are associated (or correlated) with Genfit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genfit has no effect on the direction of Valeura Energy i.e., Valeura Energy and Genfit go up and down completely randomly.
Pair Corralation between Valeura Energy and Genfit
Assuming the 90 days horizon Valeura Energy is expected to generate 0.89 times more return on investment than Genfit. However, Valeura Energy is 1.13 times less risky than Genfit. It trades about 0.18 of its potential returns per unit of risk. Genfit is currently generating about 0.02 per unit of risk. If you would invest 321.00 in Valeura Energy on September 12, 2024 and sell it today you would earn a total of 150.00 from holding Valeura Energy or generate 46.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Valeura Energy vs. Genfit
Performance |
| Timeline |
| Valeura Energy |
| Genfit |
Valeura Energy and Genfit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Valeura Energy and Genfit
The main advantage of trading using opposite Valeura Energy and Genfit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valeura Energy position performs unexpectedly, Genfit 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 Genfit will offset losses from the drop in Genfit's long position.| Valeura Energy vs. ICC Holdings | Valeura Energy vs. Hertz Global Holdings | Valeura Energy vs. Avis Budget Group | Valeura Energy vs. Old Republic International |
| Genfit vs. Eliem Therapeutics | Genfit vs. HCW Biologics | Genfit vs. Molecular Partners AG | Genfit vs. MediciNova |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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