Correlation Between Wendys and Valneva SE
Can any of the company-specific risk be diversified away by investing in both Wendys and Valneva SE 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 Wendys and Valneva SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Wendys Co and Valneva SE ADR, you can compare the effects of market volatilities on Wendys and Valneva SE 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 Wendys with a short position of Valneva SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wendys and Valneva SE.
Diversification Opportunities for Wendys and Valneva SE
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Wendys and Valneva is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding The Wendys Co and Valneva SE ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Valneva SE ADR and Wendys 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 The Wendys Co are associated (or correlated) with Valneva SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Valneva SE ADR has no effect on the direction of Wendys i.e., Wendys and Valneva SE go up and down completely randomly.
Pair Corralation between Wendys and Valneva SE
Considering the 90-day investment horizon The Wendys Co is expected to generate 0.5 times more return on investment than Valneva SE. However, The Wendys Co is 1.98 times less risky than Valneva SE. It trades about 0.02 of its potential returns per unit of risk. Valneva SE ADR is currently generating about -0.06 per unit of risk. 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 |
The Wendys Co vs. Valneva SE ADR
Performance |
| Timeline |
| The Wendys |
| Valneva SE ADR |
Wendys and Valneva SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wendys and Valneva SE
The main advantage of trading using opposite Wendys and Valneva SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wendys position performs unexpectedly, Valneva SE 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 Valneva SE will offset losses from the drop in Valneva SE's long position.The idea behind The Wendys Co and Valneva SE ADR pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Valneva SE vs. Eliem Therapeutics | Valneva SE vs. HCW Biologics | Valneva SE vs. RenovoRx | Valneva SE vs. Scpharmaceuticals |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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