Correlation Between POSCO Holdings and Valneva SE

Can any of the company-specific risk be diversified away by investing in both POSCO Holdings 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 POSCO Holdings and Valneva SE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between POSCO Holdings and Valneva SE, you can compare the effects of market volatilities on POSCO Holdings 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 POSCO Holdings with a short position of Valneva SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of POSCO Holdings and Valneva SE.

Diversification Opportunities for POSCO Holdings and Valneva SE

0.01

Correlation Coefficient

POSCO Holdings  Valneva SE

Significant diversification

The 3 months correlation between POSCO and Valneva is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding POSCO Holdings and Valneva SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Valneva SE and POSCO Holdings 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 POSCO Holdings 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 has no effect on the direction of POSCO Holdings i.e., POSCO Holdings and Valneva SE go up and down completely randomly.

Pair Corralation between POSCO Holdings and Valneva SE

Considering the 90-day investment horizon POSCO Holdings is expected to generate 1.37 times less return on investment than Valneva SE. But when comparing it to its historical volatility, POSCO Holdings is 1.49 times less risky than Valneva SE. It trades about 0.09 of its potential returns per unit of risk. Valneva SE is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  327.00  in Valneva SE on May 6, 2025 and sell it today you would earn a total of  56.00  from holding Valneva SE or generate 17.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

POSCO Holdings  vs.  Valneva SE

POSCO Holdings

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in POSCO Holdings are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain forward-looking signals, POSCO Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

Valneva SE

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Valneva SE are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating essential indicators, Valneva SE reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with POSCO Holdings and Valneva SE

The main advantage of trading using opposite POSCO Holdings and Valneva SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if POSCO Holdings 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 POSCO Holdings and Valneva SE 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.

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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.